Spain's Internet network company Gowex started on Thursday insolvency proceedings four days after the company's chief executive resignation, who admitted false accounts for at least the past four years.
The company has up to four months to reach an agreement with creditors in order to guarantee the viability of the company. The company said that it started insolvency proceedings to also guarantee workers' rights and do its duties with clients.
Madrid Mayor Ana Botella said on Monday that the city council of Madrid, which has a few contracts with Gowex in some squares and centers for technological innovation, would immediately rescind contracts with the company if its accounts were false.
Spain's High Court has charged the company's former chief Jenaro Garcia with the following financial crimes: distortion of economic and financial information, insider trading and false accounting. He will testify next Monday.
Garcia had won several prizes because of his successful experience leading Gowex.
A report by Gotham City Research questioned the company's accounts last week and Gowex' shares dramatically fell in the Alternative Stock Market (MAB) in Madrid.
Despite Gowex denied this information in the beginning, the chief executive admitted false accounts resigning on Sunday and apologizing to his workers on Tuesday.