The former board member of Meinl-Bank, which is now bankrupt, Julius Meinl V., is personally liable for the damage suffered by a former customer of the bank. For example, the Higher Regional Court (OLG) in Vienna has definitively upheld a decision of the Commercial Court against which 63-year-old Meinl had appealed. The conviction is new territory in Austria.
It is the first time in Austria that a manager has been personally prosecuted for damage to a customer of his (former) company, the “Presse” reports on Thursday. The ruling is already final because Julius Meinl V. has not lodged an extraordinary appeal with the Supreme Court. He now has to pay the investor compensation plus four percent interest and the legal costs.
Investors misled with advertisements
The case against the financial institution itself was interrupted after Meinl Bank, which most recently called itself Anglo Austrian Bank (pictured below), went bankrupt. An investor who bought certificates from the 100 percent subsidiary Meinl European Land (MEL), based on the British Channel Island of Jersey, feels ill-informed by an advertising brochure.
According to the complainant, he believed that he was investing in safe real estate. In reality, however, the depositary receipts represented shares in MEL. The injured party paid a total of 62,466.19 euros, of which he saw 20,000 euros in the form of dividend. The rest was lost as a result of the financial crisis of 2007. The man sued the difference.
MEL manipulates buybacks
The appreciation of certificates before the crisis was not due to rising real estate prices, but to buybacks by the MEL. For example, in February 2006 the latter spoke in a so-called ad hoc announcement of the over-subscription of the certificates. In reality, other companies with MEL funds would have had to buy the titles to achieve full placement.
Superior Regional Court: Brochure designed in a “whitewashed” way
The court now ruled that Julius Meinl V. was aware of the risk of total loss and at the same time knew that the brochure had been designed “whitewashed”. In addition, the defendant’s surname was used in mass advertisements, affecting him not only as CEO of the defendant bank, but also personally.
Source: Krone
I’m Wayne Wickman, a professional journalist and author for Today Times Live. My specialty is covering global news and current events, offering readers a unique perspective on the world’s most pressing issues. I’m passionate about storytelling and helping people stay informed on the goings-on of our planet.
