Austrian Times RSS FeedsLike the Austrian Times Facebook page!Follow us on Twitter!


Events for October
M T W T F S S
29 30 1 2 3 4 5
6 7 8 9 10 11 12
13 14 15 16 17 18 19
20 21 22 23 24 25 26
27 28 29 30 31 1 2
Add your event FREE

Today

Videos


BurgKino

Pub Quiz everyTuesday at Johnny's Pub

Popular in Austria


Cosmo&Nanu

Salzburg deputy resigns after 3bn rogue trader loss

Salzburg's deputy governor and the man in charge of the province's finances has announced he plans to resign next month after an alleged rogue trader gambled away billions on risky financial market ventures.

Law graduate  Monika R, 45, was hired in 2001 to speculate with taxpayers money and made massive losses in 2006 after she bought Icelandic sovereign bonds. The mother of one covered the losses by getting one of her staff to sign them off - then allegedly forged his signature after that.

The region's deputy governor David Brenner, 41, was told about the losses said by local media to be 3 billion euros weeks before - but had apparently not made them public - sparking allegations the time in between had been used to hide key evidence.

Brenner learned about the scandal on 15 October, but instead of going public with the fact that there were 253 undeclared derivative ventures in addition to the 43 on the books - it was kept secret for six weeks.

In that time they hired an investigator who Austrian media has now revealed was a former business partner of hers at a German bank that had earned around 30 million euros on the speculative deals and who - they allege - spent that time covering her tracks.

The existence of 253 illegal, secret derivative investments in addition to the 43 on the city's books was only discovered when R., who had not taken a holiday for six years, was forced to go on leave so that irregularities could be checked.

She objected so strongly that colleagues suspected she was suffering from burn-out.

Brenner, a member of the Austrian Social Democrats (SPOe), said he would continue to work on a report on the scandal until 16 January, after which the new budget would be presented to the regional government on 23 January - and that he would then step down.

His immediate superior and fellow Social Democrat Gabi Burgstaller said she had also considered resignation but then had decided to stay on to guide Salzburg through the crisis - and after that she would consider her position.

Brenner was the Social Democrats big hope for the future and his decision to step down leaves a vacuum in the party in Salzburg. Salzburg is the name of the city and the region that is one of nine federal provinces that make up modern Austria. The city of Salzburg is the capital of the province.

The region is famous as the location for the Sound of Music film, as the birthplace of Mozart and for the Salzburg Festival that is attended by Europe's elite including Prince Charles. It is the province that has lost the money.

When police arrived to question her mother-of-one R. reportedly said: "Don't take my baby away," and claimed she had only wanted to help the city - but since then her position has hardened and through her lawyer she claims that all of the deals were sanctioned by her superiors.

Her lawyer Herbert Huebel said not only is she innocent of any wrong doing but that her employers knew what she was doing.

He said: "It is always easy to accuse, buy my client is innocent of the charges - of that I am positive. She had complete authority for the business transactions both from her superiors and politically. That authority included complete freedom for the type of business that nobody complained about for years when it all seemed to be going well.

"The Federal Province of Salzburg wanted to get involved in this type of business, and my client carried it out. She did not operate alone, she reported to her managers and political masters. And she never pocketed a single cent - it was all for Salzburg. She has been questioned and has handed over the documents that prove her role, the truth will now come out.

"She herself feels herself 100 per cent not guilty. I believe that she will not be charged as she did not do anything wrong."

One insider said: "The scandal comes at a bad time, there are early elections taking place. It may be that the real situation only emerges after that." When it was first announced the loss was put at 340 million, today Austrian media have put it at between 1 and 3 billion euros.

It was also warned that Salzburg might be the tip of the iceberg - and that other local authorities might be covering similar bad debts from risky investments. Consultant Gert Edlinger from HLC Communications estimates a potential figure of 8 billion euros in local government losses due to speculation in structured financial products gone wrong in Austria.

Austrian Times


Are you on Facebook? Like the Austrian Times on Facebook and win great prizes!


Cosmo and Nanu
ORF Watch

Tag cloud:
Austrian  region  Social  governor  Democrats  derivative  lawyer  Salzburg  billions  business  media  resigns  superior  deputy  Brenner  investments  scandal  euros  losses  addition

Latest News

 

MEP caught In Brit papers Fraud Probe Jailed
A corrupt MEP caught by a British newspaper offering to propose amendments to EU laws in exchange for 100,000 euros a year has been given a three-year-jail term.

Vienna Jihad Girls Want To Come Home
The two Austrian teenage girls who became ‘poster girls’ for the jihad in Syria are now desperate to come home after getting completely disillusioned with their new lifestyles.

Mega-Station Opens
There was a festival atmosphere as Bundespresident Heinz Fischer opened Vienna's new Hauptbahnhof Friday morning.

Apple Truck Causes Traffic Jam
When 24 tonnes of apples are catapulted across a road it can only mean a jam.

Farmer Cleared Over Wolf Shooting
Furious animal rights campaigners have accused an Austrian farmer of lying after he shot dead a wolf that he claimed he thought was a fox.

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.

 


Mala Vrata

The most popular stories –
last 7 days



Don't moan alone, the Ombudsman Investigates.

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.


Austrian Zimmers