The Berlin Public Prosecutor’s Office is investigating former officials of the city’s pension fund for dentists – Versorgungswerk der Zahnärztekammer Berlin (VZB) – on suspicion of embezzlement.
A spokesperson for the prosecutor’s office confirmed to IPE that the investigation is “ongoing”, but declined to provide further details “at this time in order to protect the integrity of the investigation”.
According to a report by the business newspaper Handelsblatt, 18 individuals, including former members of the management and supervisory committees of the pension, and former employees of VZB, are accused of embezzling more than €230m.
The individuals allegedly approved risky investments or failed to conduct sufficient due diligence, according to the report.
As part of the investigation, the Prosecutor’s Office obtained an order from a court in Berlin in mid-June to search numerous email inboxes belonging to the dentists’ pension fund.
The criminal investigation started by the Prosecutor’s Office marks a new stage in the scandal surrounding VZB, which is facing €1.1bn losses.
VZB has also initiated legal proceedings against former officials to try to recover some of the losses.
In May, VZB filed a lawsuit against 12 parties, including former members of its supervisory and management committees, Forvis Mazars, Deutsche Apotheker- und Ärztebank (ApoBank) and the state of Berlin, seeking damages for losses incurred on private market investments.
In a further case, the pension fund sued its former director in Berlin’s labour court for close to €50m in damages for investments made in now insolvent insurtech start-up Element Insurance.
VZB has also accused its former portfolio manager, among other things, of having violated the contractual duty of loyalty and created a conflict of interest through the indirect involvement in a trust company, according to the labour court.
The labour court ruled in June that the dismissal and the ordinary termination of the head of portfolio management at VZB was unlawful.
In a statement, the pension fund said that it will carefully review the ruling relating to the portfolio manager and then decide on further steps, including a possible appeal.
“In this instance, as was the case with the former director, the labour court has also found a serious breach of duty,” the pension fund said.
VZB said it hopes to recover at least a portion of the losses for the benefit of its members through the proceedings.
