By on June 4, 2013
Haerter goes to court

Haerter goes to court

Porsche’s former high-flying finance chief Holger Härter was been fined 630,000 euros ($820,000) for misleading French bank BNP Paribas in loan negotiations in early 2009. This despite testimonies by bank representatives who said BNP did not feel misled.

A criminal court in Stuttgart, Germany, on Tuesday sentenced Härter “for making incomplete and wrong statements about the value of VW share derivatives held by Porsche at the time,” Reuters says.

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5 Comments on “Former Porsche CFO Fined $820,000...”


  • avatar
    The Doctor

    It’s far more likely that the court didn’t understand what derivatives are than he’s guilty.

    There was the rather delightful example in the UK where the Serious Fraud Office found documents from a company they were investigating which detailed a big transaction of CFDs for shares in Tesco.

    The SFO then got very worked up that “No trace of the shares themselves can be found…”

    • 0 avatar
      ect

      Ditto to that.

      Canada recently had a case where former executives of Nortel were charged with fraud for allegedly misleading the Board about a bonus program and (horror of horrors) restating earnings when reserves taken in thos years that turned out not to be necessary were reversed. The RCMP’s Integrated Market Enforcement Team wasted S millions and countless man-hours prosecuting a case that never had a shred of merit. As the judge found.

      If restating earnings and managing accounting reserves is a crime, then every public company CFO in existence should be in jail.

      It is a problem that very few judges or prosecutors have any knowledge of business operations. In North America, they are overwhelmingly drawn from the ranks of litigation lawyers, so they have no business education or experience.

      Some European countries (including Germany, iirc) have a system of specialized commercial courts for civil actions, so at least you get a judge who only hears commercial cases.

      In criminal courts, though, the same judges who spend most of their time on assaults, b&e’s, robberies and the like are expected to be able to expertly ajudicate complex commercial cases. Which simply can’t be done.

      • 0 avatar
        Lorenzo

        Actually, judges have the power to appoint special masters for highly technical cases, though business cases don’t seem to qualify in their minds, only scientific ones. The bigger problem is that prosecutors and investigators need special masters to tell them what they’re looking at is legal and common business practices before they file any charges. There’s no system for that.

      • 0 avatar

        Your view of this case seems overly optimistic to me. Of course, there are some courts in Germany specialized in commercial cases. But the Porsche case is a very special one and too big to be dropped. The prosecutors in Stuttgart have already invested too much time and money into this case. They are determined not to loose their faces.
        There will be convictions regardless of the facts. This is just number one. Let’s wait for the next absurdities. (BTW: Don’t expect German media to handle this topic appropriately. No brains there, anymore.)


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