Dutch Banks and Lack of Taxes: A Devastating Audit Report on Fußach.
Fossach, Bregens Stock speculation, invalid service contracts, vouchers instead of salary: the list of misconduct found by the State Audit Office in Fußach is long. Or, as Brigitte Eagle-Bargehr, director of the State Audit Bureau sums it up: You’ve never seen anything like this before. some examples:
After the financial scandal in Salzburg, the ban on speculation came into force. Speculative transactions were largely banned, which officials in the municipality of Fossach knew, as Aegler Barger asserts: “The speculative ban was well-known, and he was on top of the files.” He bought 5 million euros, and the total shares amounted to about eight million euros in 2019. Volkswagen, Deutsche Bank, as well as foreign currencies such as the Turkish lira and the US dollar were included, for a total of 40 companies. According to the signatures on the bank’s advisory documents, those involved were aware that the risk of default sometimes reached 100 percent. In 2019, it ended abruptly: the CFO sold all the products at once. The amount of damage according to the Court of Auditors: about 1.8 million euros
Dutch SNS Real
Subordinated bonds are particularly speculative securities. They pay higher interest, but the risk of default is much higher. In 2012, Fußach bought such bonds from the Dutch bank SNS Real. The bank faltered, and the credit rating fell to an undesirable level. However, Fußach bought more bonds with a total nominal value of €2.2 million (total investment €1.65 million). The bank went bankrupt and was nationalized, and the money was gone. A few years later, a Dutch court ruled the creditors’ right to compensation. However, Fußach sold the bonds to a subsidiary of the home bank. By two years. At the same time, all rights to claim losses were subsequently waived. Eggler-Bargehr: “There are still many unanswered questions.” Fußach is a financially healthy community. But while similar communities invested 660 euros per capita, it was 440 euros in Fossach. Money flowed into stocks.
The SAI has calculated a 2% return on stock transactions since 2004. However, neither the work nor the taxes has been compensated. Society forgot to pay capital gains tax. So current Mayor Peter Bowler made a voluntary disclosure Wednesday morning. Fußach must pay €720,000 in taxes within four weeks.
When the municipality decided to set a salary cap, the mayor signed off on several bonuses for the chief financial officer, returning him to the old salary. Eagle Barger explains that the mayor does not remember the signature. In addition, the CFO built his own working time model: He was paid an extra 45 hours a month, but didn’t have to work at it. His salary was 60 percent higher than his. In addition, he documented more than 1,000 hours of overtime per year, which he paid in one fell swoop in 2017 and 2020. He transferred the amount from 2020 again.
All service contracts signed with employee agendas by the CFO in his job as office manager are invalid. The mayor gave him power only orally and never in writing. Sometimes there were no contracts at all. There were employees who got paid with vouchers. Serial service contracts that were not permitted were also entered into. The municipality is currently in the process of renewing all service contracts, Mayor Buehler explains.
Mayor Fossach estimates the damage at more than two million euros. In Fußach, up to three million people speak behind closed doors. The community will complete the presentation of Buehler’s ancestor facts. The former mayor is now also charged. The Audit Bureau recommends taking legal action anyway.
A subsidiary of the home bank paid two years for the bonds that Fußach once acquired for 1.64 million euros. These bonds can actually be of much more value. So the municipality would like to have a discussion with the bank, Mayor Peter Buehler explains. In addition, this deal is now also part of the supplementary presentation of the facts to the Prosecutor of Feldkirch, which was submitted in 2020 by the then mayor against three employees. The church itself does not want to become active nowadays. “We are associated with the attorney general’s office as joint prosecutors. We will advise you on the following steps. We are determined to return the potential harm to the citizens. without regard. “The community council must determine the final action. The steps of criminal and civil law and service are in the room. That is why there will be a meeting on Friday in a week, preceded by question time with the Audit Bureau. On 80 pages, he made 46 recommendations that the community now wants to implement.