Tuesday, 23. September 2014
03. 04. 09. - 16:00
Austrian public prosecutors approved the release yesterday of Julius Meinl in return for surrender of his passport and record bail of €100m because of the risk he might try to abscond.
Vienna public-prosecution office spokesman Gerhard Jarosch said today (Fri): "Julius Meinl is a British citizen, and it was feared, on the basis of previous investigations and new evidence, that he might try to flee from justice."
The move followed Meinl’s detention on Wednesday night after questioning by prosecutors investigating allegations of fraud at Meinl European Land (MEL), a quoted property group formerly managed by Meinl Bank, which is closely held by the Meinl family.
Meinl was chief executive of Meinl Bank until the end of 2007, when he stepped down to become chairman. The bank said yesterday its operations had been unaffected by his arrest.
The arrest followed raids on Meinl's home and offices in February and came amid deepening anger among retail investors about the performance of investment funds associated with the millionaire banker.
Meinl was charged with breach of trust, the charging of excessive fees and fraud in relation to MEL.
MEL shares soared after flotation in Vienna in 2002, and the company undertook several secondary offerings marketed aggressively to retail investors. MEL's advertising campaign suggested its investment certificates (MEL shares were actually listed in Jersey) were as safe as savings accounts.
However, in summer 2007 it emerged that MEL had just completed a massive share buy-back to support its share price amid tumbling property values and falling shares for quoted real-estate groups. The transaction had not been disclosed until after its completion.
MEL was the first in a family of three investment funds launched by the bank, including Meinl Airports International and Meinl International Power. The support operation for MEL coincided roughly with the flotation of MIP - a fund created to invest in utilities in Central and Eastern Europe.
The news of the support scheme triggered a precipitous fall in MEL shares and closer scrutiny in the media of Meinl's businesses. It emerged MEL had placed partly-paid shares with unknown institutional investors, diluting the stakes of shareholders who had paid fully, and had authorised very high management fees at Meinl Bank.
The investigations also revealed the share buy-backs had not been publicised in Austria, breaching domestic stock-exchange rules.
Meinl said at the time all the steps had been legal and the support operation had not breached local regulations because MEL's stock was listed in Jersey. However, angry investors argued the support operation had been tantamount to price manipulation.
Meinl also said Meinl Bank and MEL, in which the bank had no stake, had not been linked to one another except for management contracts. The prosecutor, however, argued that Meinl Bank controlled MEL. According to the Austrian financial market regulator, Meinl Bank earned €322m through the buy-backs.
The buy-backs were at about €20 a share, and the stock subsequently dropped to less than €10, below the €11.10 issue price at the initial public offering.
MEL was sold last year to a group controlled by Citigroup and Gazit Globe, an Israeli company, and was renamed Atrium Real Estate. The other two Meinl ventures are set to be dissolved and the money returned to shareholders.
Julius Meinl V, as he is customarily identified in Austria, is one of his country's best-known business people and scion of a trading dynasty.
His great-great grandfather, Julius Meinl I, opened a coffee store in Vienna in 1862 before expanding into food retailing across the Hapsburg empire.
In 1938, the family, which is partly Jewish, fled to England, where Julius Meinl V was born in 1959. After the war, the Meinls regained control of their Austrian operations but lost those in Central and Eastern Europe to the Communists.
In 1989, the group returned to Eastern Europe, starting with Hungary and the Czech Republic. However, in the 1990s, Julius Meinl V sold the retail operations, amid declining profit, to focus on investment and private banking under the Meinl Bank name.
The family retained one flagship store - Meinl am Graben - a food emporium in Vienna. The Meinls also held on to their property portfolio in Central and Eastern Europe, forming the basis for MEL, which focused on retail real estate in the region. After going public in 2002, MEL expanded aggressively in Russia and Ukraine.
» Business 2009-04-08
Former Finance Minister Karl-Heinz Grasser has denied he wants a job with crystal manufacturer Swarovski, linked to his wife Fiona Swarovski.
» Business 2009-04-07
Jailed former BAWAG bank chief Helmut Elsner has offered to pay two million Euros bail in return for release from preventive detention.
» Business 2009-04-07
Former Finance Minister Karl-Heinz Grasser reportedly pocketed 1.2 million Euros in 2008 for his services at Meinl Power Management (MPM), it has been revealed.
Rare Bald Ibis Makes Microlight Flight To Italy
The project to introduce an extinct bird back to Europe is hailing success after successfully negotiating a new route over the Alps and training 14 Northern Bald Ibises how to fly south to winter feeding grounds in southern Tuscany.
Pat On The Back From Manure Explosive
A traffic cop in Austria got more than he bargained for after a booby trap covered him head-to-toe in manure as he was trying to catch people speeding.
Viennese Jihad Girl May Have Been Killed
Austrian police say that one of the two attractive young teenage girls who fled the country to go to Syria to fight on the side of Islamic rebels may have been killed.
Perversion of a Medical Dream
The Decline and Fall of the Otto Wagner Hospital, Vienna.
Fat Can Be Used To Burn Off Weight After New Patent Unveiled
It is being hailed as a sensation after scientists at an Austrian university patented a method that transforms fat storing cells into mini factories capable of actually destroying fat by burning it off.
Three Family Members Dead In Well Tragedy
A mother has lost her husband, her pregnant daughter and her son-in-law after a tragic accident where one of them fell into a well and the other two died while trying to carry out a failed rescue.
Brit Soldier Rescued After Climbing Mountain In T Shirt
A British soldier who tackled the frozen Austrian Alps wearing just shorts and a T-shirt has been rapped by officials after he had to be rescued from the snowy peak.
Mum And Daughter Struck By Lightning In Pool
A mother and her daughter were hospitalised after they were struck by lightning – in a swimming pool.
Police Nab Porn Star Who Filmed In Local Church
A woman accused of making a porn movie in a local church has been caught after an informant tipped off police that he recognised her by her breasts after an appeal for information.
Young Hip Hop Dancer Gets 18 Years For Drug Smuggling
A blonde hip hop dancer and charity worker promised an international career after she was spotted by a talent scout has been jailed for 18 years in Indonesia after her work offer turned out to have been part of an elaborate drugs con.
The most popular stories –
last 7 days
|Schoolboys Wear Dresses To Support Transgender Classmate|
|Pat On The Back From Manure Explosive|
|Killer Cheese Stolen In Liechtenstein|
|Masseuse In Demand After Extras For Football Players|
|Shock Moment Lift Crushes Student|
Why suffer in silence. Let off steam by letting our readers share your troubles. File your complaints about anything and everything here.
Our ombudsman David Rogers will try and help solve some of the problems from lazy civil servants through to incompetent companies – and at the very least the worst transgressors will end up in our weekly special report.