The Frankfurt District Attorney’s Office has ordered a large-scale raid of Adler Group premises in response to allegations of accounting fraud, embezzlement, and market manipulation.
175 investigators were sent by the Frankfurt DA’s Office and Germany’s Federal Criminal Police Office (BKA) on June 28, 2023, to search Adler Group business premises and accommodation at several locations across Germany and Europe. Their remit is to follow up on suspicions of accounting fraud, embezzlement, and market manipulation. Media reports indicate that the focus of the investigations is the German Group subsidiary Adler Real Estate.
Seven accused individuals are presently under investigation, reports German business newspaper Handelsblatt, including current and former managers of the real estate firm. They are suspected of having artificially inflated balance sheet figures for the years 2018 to 2020, resulting in properties being overvalued. There have also been reports of courtesy offers and sham transactions to artificially drive up prices for real estate projects.
These allegations are not brand new. The auditors refused to sign off on the annual accounts for 2021. They claimed to have been denied access to certain information in connection with key transactions.
This ultimately attracted the attention of Germany’s Federal Financial Supervisory Authority (BaFin), which is taking a closer look at Adler Real Estate’s annual financial statements for the years 2019 to 2021. Adler Group investors and shareholders have also had to come to terms with the Group operating in the red and registering billions of euros in losses, causing the shares to fall substantially in value.
The allegations of possible accounting fraud and market manipulation are just the latest piece of bad news in this ongoing saga. Investors and shareholders can protect themselves from financial losses by having someone review their legal options, explains commercial law firm MTR Legal Rechtsanwälte, whose areas of expertise include capital markets and stock corporation law.
It is possible, for instance, that they may be entitled to claim compensation if the Adler Group failed to fulfill its reporting obligations and did not immediately release information of material relevance to the share price. If the allegations of accounting fraud and market manipulation turn out to be true, this could also give rise to claims for compensation.
For advice and assistance, those concerned need look no further than the team of capital markets and stock corporation law experts at MTR Legal Rechtsanwälte.
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