Wirecard board members sentenced to pay damages

A decision has been made in the lawsuit for damages by former managers and supervisory board members of Wirecard. (Archive image) © Sven Hoppe/dpa/dpa-tmn

With his lawsuit, Wirecard’s insolvency administrator wants to secure money for the creditors of the former DAX group. The Munich Regional Court has now made a ruling. But the dispute could continue.

Munich – The Munich Regional Court has sentenced three former Wirecard board members to pay a total of 140 million euros in damages plus interest. Presiding Judge Helmut Krenek assumes that they acted at least negligently when granting a loan and subscribing to bonds and must therefore be held liable for the damage caused.

Specifically, it concerns the former CEO Markus Braun as well as the finance and product directors. The lawsuit was filed by insolvency administrator Michael Jaffé, who wants to secure money for the creditors through the action. The judgment is not yet final. On the contrary: process observers expect that there will be appeals. (Ref.: 5 HK O 17452/21).

Former deputy chairman of the supervisory board should not pay according to ruling

However, Jaffé failed in one part of the lawsuit: According to the ruling, the former deputy chairman of the supervisory board, Stefan Klestil, is not to pay. Krenek also found that he had violated his supervisory duties. However, according to the judge, this does not lead to liability. Because the management board had not complied with the supervisory board’s instructions in the past, it is not certain whether measures taken by the supervisory board would have helped in both cases.

The court, however, saw clear responsibility in the case of the three board members because the loan was not secured and there had been no thorough financial review before the bonds were issued. In the case of Braun and the CFO, Krenek derived responsibility directly from their departmental responsibilities. In the case of the product director, he argued that she should have become suspicious after questionable procedures in granting the loan.

In detail, the case concerned a loan of 100 million and the subscription of bonds for a further 100 million to a company called OCAP. The fact that the damage is only 140 million is due to the fact that part of the loan was repaid with 60 million from the bonds subscribed later.

Manager liability insurance does not pay for criminal offenses

Even after the judgment to pay damages, it is uncertain how much money the insolvency administrator will ultimately be able to get for the creditors. The managers are liable with their private assets, but it is more than questionable whether this would be sufficient. Wirecard had also taken out manager liability insurance for the board members and supervisory board members, which could cover the amount demanded. But manager liability insurance does not pay out in the case of criminal offenses committed by managers.

Braun and two other managers are on trial for suspected fraud, and former sales director Jan Marsalek has gone into hiding. The former deputy chairman of the supervisory board, Stefan Klestil, on the other hand, is not accused of any criminal offenses.