Monday, June 20, 2016

Martin Winterkorn: For VW is trying out the very existence – THE WORLD

The news of the new investigation comes for VW again to worst time: The plan you at Volkswagen had for this important week in my head looked so from Tuesday announcement of the agreement with the plaintiffs in the US. True, it will cost a few billion, but so would this thing off the table.

Wednesday then general meeting, a hefty settlement of shareholders in Hannover, but what at first line Budenzauber is because the key investors are the families Porsche, Piëch, the sheikhs of Qatar and the state of Lower Saxony. As of Thursday then lick wounds and transition to normal operation and the implementation of Strategy 2025

But it is quite different. It was not until the agreement with the applicants on request US authorities postponed. And then announces the Braunschweig public prosecutor that they are now under investigation for allegations of deliberate market manipulation against Martin Winterkorn and probably against Volkswagen boss Herbert Diess. Nine months after becoming aware of the millions of motor manipulation in Volkswagen exhaust affair takes for the first time really threaten the existence of dimensions for the automobile manufacturers.

The Federal Financial Supervisory Authority (BaFin) is to months of investigations concluded that the Group has informed investors late on “diesel gate” and the risks of the affair. Having Then have shareholders in a dispute with Volkswagen significantly better prospects for damages. There are already multibillion claims by investors against the carmaker pending.



BaFin looks intentional market manipulation in Volkswagen

The BaFin sees it also as evidence that Volkswagen has left shareholders very aware of the risks of diesel gate in the dark. The company had therefore not only violate the so-called ad hoc requirement, ie the obligation for timely information of share owners, but also be made of deliberate market manipulation guilty. For this reason, the BaFin has placed a complaint. This assumes the public prosecutor, the already determined when it comes to diesel Gate, also in this case.

Prosecutors have an investigation against the former chairman of Volkswagen, Martin Winterkorn initiated. In addition, against the boss to the VW brand, Herbert Diess be determined. Surprisingly, the investigation does not

directed against the then CFO Hans Dieter Pötsch. As CFO was responsible for communicating with investors. Pötsch is currently chairman of Volkswagen. “The prosecutor’s office takes no new facts or insights about any serious breaches of the now accused board members of” VW said.

It is crucial for the outcome of the investigation clarifying the question of when the Volkswagen board members the amount of exhaust affair was clear. The notice to shareholders was published on September 22, 2015. “However, there are sufficient factual indications that this obligation existed to a statement of the expected significant financial losses of the Group at an earlier date could,” said the prosecutor.

in fact, the US environmental Protection agency had their “message of infringement” with the accusation VW use cheating software, made public on September 18. Volkswagen had the allegations given already the beginning of September to the authority.



investors were informed intentionally too late?

the question now is why Volkswagen has at least four days to inform investors. Klagende shareholders can make a huge depreciation of its papers claimed alone in this period. The preferred shares of VW was on September 17, one day before the publication of allegations by the EPA, worth 167.80 euros. On September 22, also close of trading, the value of VW shares (assets) stood at 106.00 euros. And there are representatives of plaintive investors who claim the carmaker must the extent of the affair be a long time been clear in advance.

While the prosecutors just begin its investigations, the BaFin has their judgment already like: Volkswagen has informed shareholders too late to establishes the authority. But that alone would be an offense, valuable for complaining investors but criminal a bite.

It becomes dangerous when the prosecutor confirmed the allegation of intent. This would probably break if the damages all dams. Already, lawyers have filed lawsuits on behalf of hundreds investors. But Lawyer Andreas Tilp calls almost 3.3 billion euros for 278 partly institutional investors. Another billion lawsuit is already in preparation, it was no longer the question of whether they will file, but only when, says lawyer Axel Wegner of the Registry Tilp.

There you pleased with the new powerful ally, the one won in the BaFin. “This is good news,” Wegner said in an interview with “World”. “I was sure that the BaFin would eventually propose to our side.” For him go no more to the question of whether the investors were informed too late of view of BaFin, but rather the date from which VW should have informed.



shareholder lawsuits are in a test case negotiated

in fact, will depend decisively on how many investors will still participate in the actions. But it is clear that there is still likely to have a huge wave of further demands on the Group. With the clear statement of BaFin and the legal review of the operation has suddenly changed. Where it has been awaited and perhaps spared the risk to institute a process, it is now probably draw in court.

comes in many institutional investors adding that their management is unlikely to have another choice. Whoever makes the face of the judgment of the Authority no compensation for its investors submits that could end up getting even even legal problems.

should be Negotiates the investor claims in a so-called test cases. So separate processes do not need to be performed for each individual VW shareholders. Both VW and lawyers for the investors have applied this way. Whether it will come to the competent courts to decide. A decision will probably not be before autumn

From a law enforcement perspective are still many open questions:. Why is now just investigating two boards? Why just against these two? And above all: Why not against the then CFO? The prosecution called in its notice only a name: the ex-CEO Martin Winterkorn

The name of the second accused person is not aware of it – but the authority. tells who it is not: the former CFO Hans Dieter Pötsch. is not that determined precisely against the current supervisory board chairman, surprised, finally, the timely information of the investors of an Ad hoc announcement in his area would have fallen.

Why should Diess and Winterkorn known more have?

There has so far concentrated primarily names of the second and third rows of the VW management. In total have been assessed against 17 persons. However, they are not suspected of having manipulated the markets, but the VW engines and thus the emission tests. Of course, applies to all – for the board members – up to a conviction, the presumption of innocence. But the display of BaFin is a heavy burden.

Winterkorn became difficult at the beginning of the exhaust affair to the attention of investigators. In a first press release the Braunschweig public prosecutor had even announced the initiation of an investigation against the former CEO. But this message had the authority briefly retire later because legally must already exist for an investigation an initial suspicion, which must be based on concrete facts. In Winterkorn indeed were ads on suspicion of fraud before, prosecutors led him to Monday not as suspects in an investigation.

The key will be the question be why the prosecution – and probably also the BaFin – assumes that precisely Diess and Winterkorn knew more than the rest of the board members, in particular more than Pötsch. The prosecution has so far remained abstract: The ad hoc message you have sent until 22 September. “However, there are sufficient factual indications that such an obligation could have passed to a statement of the expected significant financial losses of the Group at an earlier date.” When this point was, do not write the investigators. The substance may have a lot of data: the latest on September 18, knew the world of the allegations of US environmental authorities, that day she made the EPA in a press conference publicly. In a reply to the first damages VW presented with the Group, who and when was informed in leadership over the manipulation. It also included only two board name. Winterkorn and Diess

It is clear that the CEO from summer 2015 would at least be able to know that VW has an exhaust problem, so fast can not be solved and attracts high penalties. Documented that is with several notes that scored Winterkorn. The prosecution states that the outcome of their investigation is open: “Whether condenses said initial suspicion or can be disproved, depends on the result of the need for further investigation on.”

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