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Star Citizen studio seeks to calm fan fears it faces financial issues

Statement details tax loan to "prevent misinformation".

Star Citizen studio Cloud Imperium Games has spoken out to quell fan fears it is in new financial trouble.

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CIG's accounts, publicly viewable via the Companies House website, sparked worries the studio had sold the games' rights as collatoral to UK banking institution Coutts. Discussion of the issue snowballed - and now CIG has spoken out.

In a statement posted on the game's official forum, CIG co-founder Ortwin Freyermuth stepped up to explain the financial issue. Freyermuth's explanation? It was simply an advance on the UK government tax rebate CIG receives every month for the development of sister project Squadron 42.

The rights to Star Citizen, Freyermuth concluded, remain unaffected.

Here's Freyermuth's statement in full:

  • We have noticed the speculations created by a posting on the website of UK's Company House with respect to Coutt's security for our UK Tax Rebate advance, and we would like to provide you with the following insight to help prevent some of the misinformation we have seen.
  • Our UK companies are entitled to a Government Game tax credit rebate which we earn every month on the Squadron 42 development. These rebates are payable by the UK Government in the fall of the next following year when we file our tax returns. Foundry 42 and its parent company Cloud Imperium Games UK Ltd. have elected to partner with Coutts, a highly regarded, very selective, and specialised UK banking institution, to obtain a regular advance against this rebate, which will allow us to avoid converting unnecessarily other currencies into GBP. We obviously incur a significant part of our expenditures in GBP while our collections are mostly in USD and EUR. Given today's low interest rates versus the ongoing and uncertain currency fluctuations, this is simply a smart money management move, which we implemented upon recommendation of our financial advisors.
  • The collateral granted in connection with this discounting loan is absolutely standard and pertains to our UK operation only, which develops Squadron 42. As a careful review of the security will show and contrary to some irresponsible and misleading reports, the collateral specifically excludes 'Star Citizen.' The UK Government rebate entitlement, which is audited and certified by our outside auditors on a quarterly basis, is the prime collateral. Per standard procedure in banking, our UK companies of course stand behind the loan and guarantee repayment which, however, given the reliability of the discounted asset (a UK Government payment) is a formality and nothing else. This security does not affect our UK companies' ownership and control of their assets. Obviously, the UK Government will not default on its rebate obligations which will be used for repayment, and even then the UK companies have ample assets to repay the loan, even in such an eventuality which is of course unthinkable.
  • This should clarify the matter. Thank you.

Long-delayed and even longer in development, the crowdfunded Star Citizen has frequently come under fire from fans for failing to deliver promised updates to the game in time.

Last year, through gritted teeth, CIG granted one player a whopping $2500 (Ł1965) refund after the studio were taken to court. The player who sued the company described the game's protracted development as a "scam".

Several months later, Star Citizen's internal schedule was released to the community in a bid for transparency. The game's beefy alpha 3.0 update was detailed, although no release date was set.

At the time, Star Citizen was scheduled to enter beta by the end of 2017, when it hits alpha 4.0. Looking even further to the future, CIG hoped to have 60 of its planned 110 star systems in place by the end of 2018.

As for Squadron 42, it was delayed from a vague 2016 release at the end of last year. Its release is currently pencilled in for this year.

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