PickUpCat was a Norwegian company established in 1996. The company was based on a module-based concept invented by Norwegian

marine engineer Marine engineering is the engineering of boats, ships, submarines, and any other marine vessel. Here it is also taken to include the engineering of other ocean systems and structures – referred to in certain academic and professional circl ...

Dag O. Aavitsland. The concept implied that ships should be built in two detachable modules so that the motor module and the

cargo Cargo consists of bulk goods conveyed by water, air, or land. In economics, freight is cargo that is transported at a freight rate for commercial gain. ''Cargo'' was originally a shipload but now covers all types of freight, including trans ...

module could be separated."Ville selge egne aksjer", in

Dagens Næringsliv ''Dagens Næringsliv'' (Norwegian for "Today's Business"), commonly known as ''DN'', is a Norwegian newspaper specializing in business news. , it is the third-largest newspaper in Norway. Editor-in-chief is Janne Johannessen, who was appointed i ...

23.4.1999, page 6

Economic problems and misleading information

In September 1998 the company's

CEO A chief executive officer (CEO), also known as a central executive officer (CEO), chief administrator officer (CAO) or just chief executive (CE), is one of a number of corporate executives charged with the management of an organization especially ...

sent misleading information to stock holders indicating that the company had signed a contract that would produce significant license income. According to the CEO's message, 6 motor units and 18 cargo units for

chemical tankers A chemical tanker is a type of tanker ship designed to transport chemicals in bulk. As defined in MARPOL Annex II, chemical tanker means a ship constructed or adapted for carrying in bulk any liquid product listed in chapter 17 of the Internat ...

were to be constructed, and this would produce significant income for the company, starting at the end of that year. The contract partner was identified as Venture Management Group Ltd in the UK. Over the next two days the price of Pickupcat stocks increased by 50%."Pickupcat-sjef tiltalt", Dagens Næringsliv, March 9, 2002, p. 17. The value of PickUpCat's stocks peaked at

NOK Nok is a village in Jaba Local Government Area of Kaduna State, Nigeria. The village is an archeological site. Archaeology The discovery of terracotta figurines at this location caused its name to be used for the Nok culture, of which these ...

130, the company's value thus peaking at NOK 600m (USD 80m)."JJ Ugland drops its Pickupcat holding"
Trond Lillestolen, in Weekly, Trade Winds, 16 Oct 1998 In October 1998, the JJ Ugland group sold its shares in Pickupcat, and the company head, Øivind O. Larsen, withdrew from Pickupcat's board. Leif Hoegh & Co also sold their shares that year.Pickupcat talks tankers
, Trond Lillestolen, in Weekly, TradeWinds, 23 Apr 1999 Between December 1998 and April 1999, the CEO repeatedly informed that the shipping company Gerrards Rederi in

Kristiansand Kristiansand is a seaside resort city and municipality in Agder county, Norway. The city is the fifth-largest and the municipality the sixth-largest in Norway, with a population of around 112,000 as of January 2020, following the incorporation ...

, Norway, would invest in the company, and that contract had been signed. In the company's

annual report An annual report is a comprehensive report on a company's activities throughout the preceding year. Annual reports are intended to give shareholders and other interested people information about the company's activities and financial performance. ...

for 1998, dated March 22, 1999, Pickupcat still maintained that a contract with Gerrards Rederi existed, and that Pickupcat's negative balance was a result of the failure of Gerrards Rederi to meet its obligations, when in fact no such contract had been signed. According to the Norwegian business newspaper

, a memo written for Pickupcat by lawyer Ronny Mulstad in January 1999 furthermore indicated that there were plans to sell stocks to Monaco-based French businessman Michel Batis to an artificially high price of NOK 125 per share. In April 1999 Pickupcat's stocks were traded for NOK 20 per share."Johnsen risikerer erstatningssøksmål", Dagens Næringsliv April 23, 1999, p.6 In April 1999, Pickupcat management were in Spain to negotiate with a shipyard.

Investigation and trial

The

Financial Supervisory Authority of Norway Finance is the study and discipline of money, currency and capital assets. It is related to, but not synonymous with economics, the study of Production (economics), production, Distribution (economics), distribution, and Consumption (economics) ...

notified the Norwegian National Authority for Investigation and Prosecution of Economic and Environmental Crime (ØKOKRIM). This latter initiated in March 1999 investigation of PickUpCat's CEO and its former

chairman The chairperson, also chairman, chairwoman or chair, is the presiding officer of an organized group such as a board, committee, or deliberative assembly. The person holding the office, who is typically elected or appointed by members of the grou ...

Arve Johnsen Arve Johnsen (born 18 February 1934) is a Norwegian industrial executive and politician. He was educated in business administration with the degree ''siviløkonom'' from the Norwegian School of Economics and Business Administration in 1957 and in ...

, and subsequently charged PickUpCat's CEO with

fraud In law, fraud is intentional deception to secure unfair or unlawful gain, or to deprive a victim of a legal right. Fraud can violate civil law (e.g., a fraud victim may sue the fraud perpetrator to avoid the fraud or recover monetary compens ...

. In April 1999, CEO Aavitsland was forced to resign because of the investigation. The charge against Pickupcat's CEO was double: In addition to the charge of misinformation related to the alleged contract with Venture Management Group Ltd., he was also charged for providing misleading information about negotiations between Pickupcat and Gerrards Rederi. Practical problems with securing evidence in the UK hampered the investigation. Difficulties also arose from the fact that the former CEO had emigrated to France. In 2005, however, the former CEO was

extradited Extradition is an action wherein one jurisdiction delivers a person accused or convicted of committing a crime in another jurisdiction, over to the other's law enforcement. It is a cooperative law enforcement procedure between the two jurisdict ...

to Norway. The founder and former CEO Aavitsland was convicted to seven months imprisonment for having mislead the company's stock holders. The charges against former chairman Arve Johnsen were dropped. He had not been aware that contracts had not been signed.Tidligere styreleder Arve Johnsen ble ikke informert 2005-12-14
, Sytreinformasjon AS.

References

{{Reflist, 2 Shipbuilding companies of Norway Companies established in 1996 Finance fraud Corporate crime