Capital and Investment Fraud – Evidence by Our Detectives from Hanover

More than 27,000 asset and forgery offences were reported to Hanover Police Directorate in 2014. Investment fraud is usually committed by financial advisors, or those claiming to be financial advisors, in order to defraud unsuspecting investors by promising high returns. The most well-known example is the Ponzi scheme, where an increasing number of investors are recruited on the basis of successful predecessors to keep early investors engaged with newly generated capital and to accumulate ever larger personal reserves, with the aim of eventually disappearing and causing the system to collapse.

Investment fraud constitutes a separate criminal offence under the German Penal Code (§ 264a) as an extension of fraud. It clearly defines that concealing adverse facts and spreading false statements to deceive a larger group of people about the nature of offered investments constitutes fraud, specifically in connection with securities, subscription rights, and company shares with profit participation. The penalty is up to five years’ imprisonment, or in particularly serious cases (for example, forgery to deceive investors) up to ten years.

If you believe or know that you have been a victim of investment fraud, the detectives of Kurtz Investigations Hanover are happy to discuss with you the possibilities for proving the offence and bringing the perpetrator to justice: +49 511 2028 0016.

Not Every Loss Is Investment Fraud – Police Investigations Often Restrained

Financial and investment markets are increasingly complex. Today, one can even purchase catastrophe bonds, which, for example, pay out based on the absence of natural disasters in the USA or if the damages do not exceed a certain threshold. It is advisable to rely on reputable, established providers. Losses in investments are a logical consequence of the system and cannot be entirely ruled out – otherwise, everyone would invest in these types of assets. Accordingly, the financial advisor must be proven to have acted with intent to deceive. Poor advice or speculative errors are not criminal acts per se, but typical investment risks. Because proving intent to deceive – the deliberate fraud – can be difficult and time-consuming, authorities often give up too early, leaving the field to private investigators.

A problem for investors arises if fraud can be proven by our detectives from Hanover, but the convicted offender is penniless and cannot compensate for the damage. Sometimes deception can still be demonstrated through asset investigations, but as in the financial markets, there are no guarantees.

When the Police Cannot or Will Not Act, Private Detectives Are Needed

In early June 2015, a police scandal uncovered by Norddeutscher Rundfunk shocked the German public. Several Hanover police officers had posted numerous messages on the social network Facebook that indicated base motives, xenophobia, and readiness for violence. For example, they wanted to show the immigrant “scum” where the limits were. Police officers are supposed to comply with the so-called good conduct clause to maintain exemplary behaviour and the reputation of their profession. Unfortunately, among the mostly honest and competent officers in our state, more and more troublemakers abuse their office to act on base impulses: police violence, harassment, humiliation, mistreatment of alleged offenders. “Arm yourself, baton free. We are ready,” wrote one of the involved officers in connection with a police operation at a Bundesliga match of Hannover 96. Investigations are now being pursued against him and other “colleagues.”

The regrettable deterioration in police work quality is the result of political budget cuts.

Even Jörg Radek, Chairman of the Federal Police section of the Police Union, admits: “Due to lack of personnel and funds, training in the Federal Police is practically at rock bottom, almost nothing happens.” In particular, the social skills of police officers require improvement – an outrage in such a responsible profession! Victims of violence repeatedly report assaults and humiliation in police stations across the country. Because the involved and complicit officers form a secret clique while victims stand alone with their statements, the victims have little chance of obtaining justice in court (compensation for physical and psychological injuries, enforcement of criminal consequences against unworthy officers).