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Impact Investing

IPE special report May 2018

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Swiss collapse costs E44m

Switzerland’s biggest employee benefits debacle, the collapse of the four Vera and Pavos pension foundations for companies within the Olten based real estate entrepreneur Albert Heer group, liquidat ed in 1996 with debts of Sfr150m (E94m), could be resolved this month.
The collapse of the foundations has already cost the security fund of Switzerland’s second pillar pension regime Sfr70m to protect the 2000 employees of around 100 separate companies from retirement losses.
Subsequent investigations into the debt affair by the new foundation board and liquidators have uncovered extensive and grave breaches of pension foundation duty, according to Christoph Degen, member of the foundation board appointed to investigate the scandal.
“The Vera/Pavos structure made goals and interests subservient to it, that had nothing to do with the actual purposes of the employee benefits plans.
“ The foundations gave high risk loans to companies within the Albert Heer group which had solvency problems and were unable to pay the money back,” he says.
“ The new foundation board now believes the prior board, the auditors of the funds Visura, the two experts for occupational pension plans under the BVG Swiss pension fund law and the insurance companies Zurich and La Genevoise involved in the case, to probably be responsible for the massive debt of the foundations.”
Degen says discussions are currently taking place between the new board, the insurers and the auditors to look at the issue of damages with the talks expected to conclude this month.
“ If a satisfactory conclusion is not reached then we will have to take the case before the courts,” he comments.
Hugh Wheelan

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