Cryptocurrency firm with links to MPs and footballers vanishes

A cryptocurrency company that had been backed by some MPs and a top flight footballer has disappeared, leaving thousands of pounds unaccounted for. Phoenix Community Capital started last year as a cryptocurrency project and investment scheme, and at one point claimed to be worth $800m (£665m).

But mystery surrounds the business as its website has disappeared.

The firm had close ties to two multi-party parliamentary groups (APPGs). These are informal groupings of members of the House of Commons and the House of Lords, who have no official status within Parliament.

Phoenix Community Capital was reportedly a sponsor for one APPG, while its co-founder, Luke Sullivan, spoke at an event for another.

But in September 2022 the company seemed to disappear. Its website was offline and social media pages went silent: the company's last tweet was on September 8.

The company's "nests" - its investment portfolios - have become unreachable for its 8,000 users.

One investor, Alan Rogers, a former Premier League footballer, said he had lost around $50,000 and believed the founders were no longer involved.

Another investor told the guardian they had lost around £5,000, adding: "I got greedy buying the nests. To be honest the profits were ridiculous... People obviously kept buying more nests with the profits rather than getting paid."

Some reports suggest that the company has been acquired by someone known only as "Dan", who immediately informed investors that he had no responsibility towards them.

The new incarnation of the company, led by Dan, claimed that approximately 1,000 investors had earned returns on their investments, which totaled $57 million. By comparison, about 7,400 had a loss of about $87 million.

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The crypto firm had donated £5,000 to blockchain affiliate APPG in 2022, according to crypto.news, and was also listed as a corporate partner on their website. This APPG is headed by SNP MP Martin Docherty-Hughes, who denied any contact with or knowledge of Phoenix.

Although APPGs are chaired by parliamentarians, they are often run or funded by lobbyists and corporate donors seeking to influence government policy or gain credibility.

Mr Sullivan was also welcomed at an event by the leader of another APPG, Pola Uddin, a fellow unaffiliated former Labor councillor. She could be seen praising Sullivan in a video on the terrace of the House of Lords, where she said he was "an expert and I know he is deeply committed to community empowerment."

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Professor Birgitte Andersen, from the Big Innovation Centre, said it was "wrong to bring APPG into the Phoenix Community Capital controversy", adding: "There is no connection."

She said that the company "did not participate in APPG's blockchain evidence sessions to my knowledge" and that APPG and its secretariat "behave in a transparent, ethical manner, and our evidence and expert speakers add to the decision-making in evidence for policymakers".

Docherty-Hughes said: "I have spoken on several occasions in the House and elsewhere about the pernicious use of opaque funding in our politics, and the loopholes that remain that allow individuals and companies to influence the political process without necessary scrutiny. It has been clear to me for some time that APPGs are one of those back doors that have been left wide open, giving access and privileges in parliament to people who really don't deserve it."

He added: "The vast majority of APPGs, including those of which I am a member, would have nothing to fear from stricter regulation that would ensure transparency and accountability in the process of funding this vital work."

On her presentation of a company-sponsored breakfast, Lady Uddin said: “The organizer informed me that Mr. Sullivan was an expert in his field of work and was involved with schools and committed to improving technology education in the community. I simply reiterated the information that was given to me at the meeting.”