Accusation of bogus deals and overvaluation of real estate.
After the collapse of the trading giant Steinhoff, three high-ranking ex-managers should answer to a German court on suspicion of billions in balance sheet manipulation, according to the prosecutor's office. The public prosecutor's office in Oldenburg has brought charges against the trio for incorrect presentation in balance sheets, as the investigators announced on Thursday.
Overall, according to the indictment, it is about balance sheet manipulation through sham deals of more than 1.5 billion euros. In addition, real estate is said to have been valued at 820 million euros too high in the books.
The prosecution did not reveal the names of the managers. The Oldenburg Regional Court has to decide whether the main proceedings will be opened against the managers. Up to three years imprisonment are available for balance sheet manipulation. Steinhoff is based in Stellenbosch near Cape Town in South Africa, but its roots are in Westerstede near Bremen.
Three years ago, the group had admitted that the balance sheet was missing more than six billion euros. The former management of the company, which at times was worth more than 20 billion euros on the stock exchange, had inflated sales through sham deals and thus hushed up losses. The managers at the time should be responsible for ensuring that the book profits from the bogus transactions flowed into the balance sheets. Steinhoff subsidiaries are said to have sold intangible goods and company shares for three-digit million amounts each to other companies that are related to Steinhoff. A fourth manager is also accused of aiding and abetting manipulation of the balance sheet. He worked for two companies involved in handling the bogus business.
The new Steinhoff management is working on getting the finances in order and cutting the company back to its healthy core. Subsidiaries in Europe such as the stakes in the German “Poco” cheap furniture stores, the Austrian “Kika” and “Leiner” furniture stores and the French furniture chain “Conforama” have already been sold. Protective shield proceedings have begun in the Netherlands, on which the Steinhoff Holding wants to come to an agreement with its creditors.
