The postal worker will then send your signed documents to the bank

The postal worker will then send your signed documents to the bank

The aim of all of them: a lawsuit, an action for damages. Compensation for fraud.

One possible plaintiff is the Berlin lawyer Fabian Tietz. He has now gathered around 70 small investors, and together they have invested around one million euros in Wirecard shares over the past few years.

Reports against Wirecard and against the supervisors

"I filed four criminal complaints at once"says Tietz. "One against the Wirecard management board on suspicion of delaying insolvency, one against the supervisory board, which may not have controlled the management board strongly enough." He is also targeting EY and the Bafin banking regulator. "Both failed miserably in the audit", says Tietz.

Lawyer Fabian Tietz has filed several complaints in the Wirecard case – also against the EY auditors. (Source: Florian Schmidt / t-online)

In principle, anyone can place advertisements. Whether they will actually become a criminal case is still open – and depends heavily on how the prosecution’s further investigations go. Uncertain outcome.

It is difficult to estimate how high the number of Wirecard losers is, how many of the company’s 123 million or so shares are in the custody accounts of German small investors. The fact is: The shareholder quota in Germany is very low compared to the population of other countries – not least since many savers burned their fingers with Telekom shares in the late 1990s. According to the Deutsches Aktieninstitut, only 2.5 million Germans owned shares in companies in 2019.

Even taking into account investors who own equity fund units, the shareholder quota in this country is only 15.6 percent. By way of comparison: in the United States, every fourth citizen recently owned shares.

Nevertheless, more and more small investors join Tietz’s plans. People from the middle of society, women and men, who, despite the prevailing fear of stocks among Germans, had the courage to invest their money in the stock market.

"There was nothing to indicate inconsistencies"

One of them is 68-year-old Sabine Mulla from Teltow near Berlin. "I had a home loan and savings contract paid out to me in summer 2019", she says. It was clear to her that she wanted to invest the money in stocks because other forms of investment offer little income. "We then invested part of the money in Allianz shares, around 25,000 euros in Wirecard"she reports.

Pensioner Sabine Mulla: She invested in Wirecard with the money from a disbursed home loan and savings contract. (Source: Florian Schmidt / t-online)

At this point in time, the Wirecard share fluctuated around 150 euros. The step was not thoughtless. "My husband had been dealing with Wirecard for a long time", says the 68-year-old who used to work as a manager in a company. Although the first allegations were already in the British at that time "Financial Times" known. The banking supervisory authority Bafin, however, had clearly backed Wirecard by prohibiting speculation on falling prices. Mulla: "Nothing indicated inconsistencies for us."

Equity investments for old age

Some time before that, Berliners Wolfgang Sandkötter, also 68 years old, and Detlef Neumann, 44, had joined Wirecard. Sandkötter, a graduate engineer, had invested 75,000 euros in shares in the payment service provider. Neumann, who works as a freelance asset manager and therefore does not want to see his real name published, even bought shares in the company for 119,000 euros.

Pensioner Wolfgang Sandkötter: The income from Wirecard shares should secure him in old age. (Source: Florian Schmidt / t-online)

"The Wirecard shares were my pension plan"says Sandkötter. "I watched the stock a year ago and thought it was a solid investment. After a few years, I wanted to sell them again to put some money aside. My children shouldn’t have to pay for my care later."

A brilliant success story

Neumann had also dealt intensively with the company before buying the share. Like Sabine Mulla and Wolfgang Sandkötter, he believed he understood Wirecard’s business. "The success story of the future of payment that Wirecard told was brilliant"he still says. "The business model was conclusive."

The Wirecard cheated: lawyer Fabian Tietz (from left), Sabine Mulla, Wolfgang Sandkötter and Detlef Neumann in the office of the Berlin law firm on Kurfürstendamm. (Source: Florian Schmidt / t-online)

He was also convinced by Wirecard’s rise to the top German stock market league, the German share index, in 2018. At that time, Wirecard replaced Commerzbank, which was no longer quite so venerable after the global financial crisis. A young fintech for a dusty bank in the Dax – a seal of approval for Neumann. "At a company that plays in a league with the likes of VW, Daimler and Siemens, there must be something behind it", he says.how to write an argumentative essay introduction

How naive were the investors?

In fact – that much has long been known – exactly that was not the case. Neumann, Mulla and Sandkötter watched as new allegations arose against Wirecard under their boss Markus Braun. Occasionally they all got a queasy feeling over and over again.

And yet everyone stuck to their investment until the end. Was that reckless, stupid, naive?

After Wirecard postponed the presentation of its consolidated financial statements several times in Corona spring 2020, customs investigators arrived at the company headquarters in Aschheim at the beginning of June. Then on June 18, the shock for investors and investors: In the books of Wirecard 1.9 billion euros are missing – a quarter of the balance sheet total, according to company statements "predominant probability" does not exist.

"From today’s perspective a huge mistake"

"I couldn’t imagine that"says Neumann. "I didn’t believe that. So much money can’t just go away." And because he saw it that way, he even bought more: On the same day, he put around 10,000 euros in additional Wirecard shares, which were now very cheap thanks to the extreme price slide.

Attention: You should avoid these five mistakes when investing

"From today’s perspective, of course, that was a huge mistake", he says. "At that moment, however, I didn’t believe it was a fraud. I still had the business idea in mind that I was convinced would be successful."

The rest is history: The share fell into the abyss, ended up with a value of a little more than just one euro, CEO Markus Braun was fired. Asia boss Jan Marsalek went out of his way, Wirecard filed for bankruptcy, and the Munich public prosecutor began investigations into suspected gang fraud.

118,000 euros loss with Wirecard shares

What remains for Neumann is a gigantic financial loss. Only last week he parted with his almost worthless 1,000 shares. "I lost a total of 118,000 euros with the Wirecard shares", he says.

That’s why he’s angry with himself on the one hand. He’s angry that he didn’t sell earlier. On the other hand, and this unites him with Wolfgang Sandkötter and Sabine Mulla, he is also angry with the management of Wirecard. "The financial loss hurts a lot"says Sandkötter too. "Much more important to me, however, is that those responsible must be held accountable. I would like to see Wirecard managers Braun and Marsalek in jail."

His personal consequence of the expensive teaching: "I am not going to buy any new shares in my life." Sabine Mulla wouldn’t go that far. But she also says: "How Wirecard played along with us small investors is a cheek. It cannot be that the managers get away with it."

A fight like David against Goliath

Every petty criminal must answer to the courts and serve his sentence. "That must also apply here", she says. "I therefore want to join the possible lawsuit."

According to lawyer Tietz, it is not yet possible to say whether and when such a lawsuit will arise. But one thing is certain: a possible procedure will take a long time. "Since Wirecard itself is insolvent and its ex-boss Markus Braun can only be prosecuted with difficulty, we expect the greatest chances with EY’s liability"says Tietz.

According to the report: Investigators access the assets of the ex-Wirecard boss to insolvency proceedings: More than 700 Wirecard employees terminated Fraud billions: Ex-Wirecard board member deceived auditors with actors

But it is precisely this argument that resembles a fight like the one between David and Goliath. Because EY employs numerous top lawyers who will do everything possible to fight a potential process through all instances.

"Such a process can take up to ten years"the lawyer estimates. And it would be very expensive. That’s why his law firm is now looking for a litigation financer, which – according to Tietz – is not that easy.

Sources used: Own research Talks with Fabian Tietz, Sabine Mulla, Detlef Neumann and Wolfgang Sandkötter Shareholder figures of the Deutsches AktieninstitutAdditional sourcesShow less sources

Fixed-term deposits sound old-fashioned, but can be an important part of your investment. We explain what kind of interest you can expect, how long your money is tied up and for whom fixed-term deposits are good.

overview

What is fixed-term deposit? What terms are possible? How do I invest fixed-term deposits? Is fixed-term deposits worthwhile? What are the advantages and disadvantages?

It currently looks bleak for savers: If you want to invest your money as securely as possible, you have to accept measly interest rates. It is all the more important to find the best offer for yourself.

The most profitable of the secure types of investment is the fixed-term deposit. However, you have to make compromises elsewhere. We explain whether fixed-term deposits are right for you, what it is and show you the advantages and disadvantages of this classic investment. 

Saving Tips: Five Ways to Make More Money

Photo series with 5 pictures

What is fixed deposit?

With fixed-term deposits, you invest your money over a fixed period of time and at a predetermined interest rate. This means that you will not get your money before the term expires.

For this, however, you usually collect higher interest than for overnight money and you can be sure that the interest rate will not fluctuate. Fixed-term deposits are also called fixed-term deposits or time deposits because you invest your money by a certain date.

What terms are possible?

You can invest time deposits for different periods of time. There are offers from one month upwards, but also up to several years. However, experts recommend not to exceed maturities of 36 months, because it is difficult to predict how interest rates will develop – and it would be annoying if you were tied to an interest rate for years while the interest rate level has actually risen again.

In addition, it is true that the amount of interest granted increases with the length of the investment. From around four years onwards, however, they no longer increase at many banks.

For even longer terms of ten or 15 years, it is even worth taking a look at the stock market. Savings plans on so-called index funds, now better known under the abbreviation ETF, usually bring higher returns. 

Popular investment: How much return do ETFs generate? ETF savings plan: This is how you can easily prepare for old age

How do I invest time deposits?

In order to invest a fixed deposit, you need a fixed deposit account. The best conditions are usually available from direct banks – so you cannot open the account in a branch. Instead, direct banks use either the so-called Postident procedure, the video identification or E-Ident procedure.

All three procedures are used to confirm your identity. With the classic Postident procedure, you print out the application to open an account and take it to the nearest post office. There you show an employee your identity card or passport. The postal worker will then send your signed documents to the bank.

With the videoident process, you save yourself the trip to the post office and identify yourself in a video chat with a bank employee. For the E-Ident procedure you need a smartphone with NFC function and an identity card with a PIN. The NFC function makes it possible to exchange data over short distances. However, not all banks offer e-ident and video-identification procedures.

Is fixed deposit worth it? 

In general, it is always advisable to invest some of your assets safely. High interest rates are then not the decisive selection criterion – even if they are usually higher for fixed-term deposits than for overnight deposits, which are also secure. You can also read our guide to asset allocation.

Whether fixed deposit is something for you depends on how flexible you want to access your money.