The Strategist

Deutsche Bank is Accused of Disrupting the Investigation

05/05/2015 - 16:43

The prosecution believes that the bank's management intentionally impeded investigating high-profile case of the bankruptcy of the German businessman Leo Kirch’s media empire.

Jürgen Fitschen, by Jochen Zick, Action Press
Jürgen Fitschen, by Jochen Zick, Action Press
The Munich prosecutor's office accused the Deutsche Bank of disrupting the investigation. As reported on Tuesday, May 5th by the agency dpa, the prosecutor Stephan Necknig stated this during the second meeting on the case of Deutsche Bank. According to him, the bank regularly and deliberately obstructed the data transfer required for the investigation, and the responsibility for this rests with the management of the credit institution. In turn, the representative of Deutsche Bank rejected the prosecutor's accusations. He assured that the bank has always fully cooperated with the investigation and is going continue to do so in the future.

The trial in relation to the bank's management started in Munich on April 28. The defendants are co-chairman of the Board Jürgen Fitschen and four top managers. Prosecutors accused them of perjury in the case of bankruptcy of the German media empire owner Leo Kirch.

The trial is directly related to the scandal surrounding the bankruptcy of the late tycoon's media empire. Its owner was convinced that the reason for this was the statement of the then head of Deutsche Bank Rolf Breuer, to doubt the creditworthiness of the media holding. In February 2002, a Bloomberg reporter asked Breuer’s opinion about banks to continue giving credits to Kirch’s company. “I think it's pretty doubtful, - said Breuer. - All written and said about it, showing that monetary institutions are not ready to continue to provide him with credits.”

This statement was a sentence for Kirch’s media empire. Two months later, Kirch Group has started the procedure of bankruptcy. Having the debt of 6.5 billion euros, its collapse was the largest in Germany in the postwar period. Two months later, the parent company Taurus Holding went bankrupt too. Kirch’s lifework was destroyed. "Rolf shoot me" - said Kirch. He promised to take revenge. So the unprecedented scale trial has begun.

According to Kirch, the bank wanted to make money on the destruction of the media empire. After the magnate’s death, his relatives filed several lawsuits against Deutsche Bank and eventually received compensation in excess of 900 million euros. However, according to the prosecutor's office in Munich, the defendants have given false testimony at the trial in order to achieve reduction of the amount of payments to the heirs of the media mogul.

Fitschen, however, intends to fight. "I did not lie, and not engaged in fraud," - says the banker. According to its trustees, the head of Deutsche Bank declined to bargain with the prosecution, as a result of what he probably would have escaped with a fine. Fitschen is defended by one of the most renowned lawyers Hanns Feigen, who previously represented the interests of the former president of the Munich football club "Bavaria" Uli Hoenes. However, the lawyer did not help him avoid prison for tax evasion.

Josef Ackermann and Rolf Breuer, former chiefs of Deutsche Bank, will appear in the court along with Jurgen Fitschen, as well as two former members of the Board of Directors.

Bank on the threshold of major changes

Although the Court limited is by one session per week, this process went extremely malapropos. Deutsche Bank is on the verge of a major reorganization, and it requires the presence of lead in its entirety. The new strategy primarily involves a reduction of annual costs and the separation of retail banking subsidiary - Postbank. During this period, Fitschen will have to change their office to the courtroom once a week. The court pre-scheduled 16 sessions, which will last until September. It is still unknown if this will be enough.


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