Wirecard AG’s bankruptcy is likely one of the biggest economic scandals in German history. Within no time it became clear that the high-tech hopes for online payments were nothing but a colossal fraud scheme.
Dutch foundation to enable assertion of claims against EY Deutschland and EY Global – at no cost and risk-free.
Several
thousands of private investors lost their entire capital because they
trusted the company. They believed the Wirecard story because of the
consistently growing sales and profits, which for over a decade were
audited and certified without question by EY accountants.
Foundation under Dutch Law Perfect Litigation Vehicle – at No Risk for Affected Investors
Against this background, the aggrieved investors will wonder how they
can claim compensation for their losses against EY successfully, and at
no risk. Together with the law firms of Nieding+Barth (Frankfurt am
Main) and AKD Benelux Lawyers (Amsterdam), which specialize in capital
market law, DSW (Deutsche Schutzvereinigung für Wertpapierbesitz), the
leading German association for the protection of investors, has the
answer. A not-for-profit foundation was set up under Dutch law as a
litigation vehicle: Stichting Wirecard Investors Claim. “The advantage
of using a Dutch foundation opens up the possibility of reaching a
settlement with EY (including EY Global) for all injured Wirecard
investors in Europe. The choice of a Dutch foundation offers options
that are not available under German law”, said Marc Tüngler, managing
director of DSW.
EY Global to be Held Co-Responsible
The Foundation will be targeting EY Global as well as EY Germany and
other EY entities involved in the audit. ‘This is only logical, from our
point of view, as EY Global failed in its supervision of EY
Deutschland, and for that reason is also liable for the investors’
losses. It would be unacceptable if EY Global were to get away with
this’, commented Klaus Nieding of Nieding+Barth lawyers. The additional
advantage of involving EY Global is that it has the financial means to
offer Wirecard investors meaningful compensation. ‘If EY
Deutschland/Global would prove unwilling to settle amicably, we will go
to court. We are currently drafting the statement of claim so we can
file it with the competent court in time. In none of these scenarios the
Wirecard investors will pay the litigation costs, as these are covered
by the foundation ‘, Nieding continued.
Over 30,000 Registered Victims – Damages Exceed 1.5 Billion Euro
Professor Gunther Friedl, one of Germany’s most renowned economists,
is chairing the foundation’s board. Professor Friedl is Professor of
Business Administration at the Technical University of Munich, where he
holds the Chair of Management Accounting and is Dean of the TUM School
of Management. ‘We are thrilled that Professor Friedl has agreed to
chair the foundation. Clearly, besides the damages and the number of
victims, the foundation’s reputation is decisive for its success ‘, said
Tüngler. He added: “Over 30,000 victims have registered with DSW,
seeking around 1.5 billion Euro in damages”.
EY – Wambach Report Confirms Failure
Following the bankruptcy, doubts about the audits by EY grew. “And
with it the pressure on the accountancy firm, which in the Wirecard case
remains one of the defendants who has the capital to settle the claim”,
commented Patrick Haas, partner at AKD Benelux Lawyers. The so-called
Wambach Report clearly showed that EY consistently failed to observe
basic principles of auditing.
KapMuG-Proceedings Fall Short
Recently the Munich Court issued an order for reference for capital
investor model proceedings (KapMuG-proceedings) in an action initiated
by shareholders against both the former CEO of Wirecard, Markus Braun,
and EY Deutschland. It is now up to the Bavarian Supreme Court to decide
whether it will come to KapMug proceedings in this case. In any case,
it is not possible to initiate KapMuG-proceedings against EY Global.
Foundation Offers Solution for All Victims
All investors affected by Wirecard can join the foundation, including
non-German investors. This is why BETTER FINANCE, the European
Federation of Investors and Financial Services Users, supports the
action.
As of now, affected investors can register at https://www.dsw-info.de/en/wirecard-info-service/
free of charge. After registration, they will receive more information.
Of course, only victims who have not yet joined an action can take part
in the action to be filed by the foundation. "The prohibition of
so-called double lis pendens does not allow parties to take
part in several proceedings at the same time", said Nieding, emphasizing
that victims should take action now, and register with the foundation
Better Finance
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