Trial opens over alleged 14.1 million euro investment fraud

A trial began on Monday over an alleged investment fraud that prosecutors say caused losses of 14.1 million euros and affected 918 people, ORF reported. The two defendants, aged 51 and 59, initially denied the allegations.

Prosecutors say the men used companies to promise high returns from investments in foreign exchange trading, cryptocurrencies, property, precious metals and start-ups. Promotional brochures, videos and customer software were used to market the schemes, which allegedly promised returns of up to 25 percent a month.

The prosecutor said no genuine investments had ever taken place. The indictment alleges that between March 2017 and February 2019, the defendants used a network of salespeople to recruit investors and falsely claimed they had the necessary licences, that regulators in Austria and Germany checked their operations, and that investments were protected by bank guarantees. They also claimed to have a subsidiary with exclusive access to 1,000 existing properties.

The younger defendant denied responsibility in a statement read by his lawyer. He said he had invested his own money and lost it, but had no management role or decision-making powers and received no payouts. He said he had assumed the older defendant had carried out the agreed investments.

The 59-year-old said the younger man had been involved throughout and that planned projects had failed to materialise, leaving the business in what he called “investment distress”. He had described himself in promotional material as an entrepreneur with more than 30 years of experience, a government financial adviser and a bank owner. He told the judge that the last claim had been “poorly worded”. The article said he was trained as a masseur and therapist.

Three days of hearings have initially been scheduled. The defendants, who remain at liberty, face up to 10 years in prison if convicted as charged.