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| Kiener Faces 15 Years in German Prison |
What was supposed to be an epic battle on the witness stand between German prosecutors and accused hedge fund Ponzier Helmut Kiener changed dramatically when lawyers read a statement admitting guilt in the affair. The statement said the Kiener did in fact run a €345 million Ponzi scheme because:
"I just didn't have the courage to liquidate the K1 funds when I saw they got into trouble. I trusted that I could make up losses by investing just more and more new money."
Ironically, Kiener is a trained psychologist, yet he blamed his behavior on “enormous psychological pressure.” and that he
"came up with the idea to use my computer to forge some of the account statements. After getting through with it one time, that nasty habit sort of slipped in."
There are 121 counts of forgery lodged against Kiener, who may enjoy the hospitality of the renowned German prison system for 15 years. Seven other individuals were arrested in the case, including one who committed suicide as being chased by police.
Kiener didn’t take the full blame, but rather sought to spread it around the likes of Barclays and BNP Paribas:
"As the banks approved all my investment suggestions, I felt on the safe side. I thought my investment decisions would be equivalent to market practices. I know that this was a conflict of interest and that I violated investment rules I had with the banks, and I bitterly regret it,"
What he means, of course, is that he bitterly regrets getting caught.
© 2011 Hedge Fund Writer LLC
