HGAA trio acquitted

Three former Hypo Group Alpe Adria (HGAA) employees have been found not guilty of embezzlement.Ex-HGAA head Wolfgang Kulturer, former HGAA Austria chief Gert Xander and Albin Ruhdorfer, a former attorney of the bank, were acquitted at the Provincial Court in Klagenfurt, Carinthia, yesterday (Tues).The businessmen were accused of embezzlement concerning two controversial lending deals.HGAA – which was nationalised due to immense losses in December 2009 – granted a credit of two million Euros to Styrian Airways AG (Styrian Spirit) in 2005. The small airline was in severe financial difficulties at that time and went bust the following year. Weekly magazine profil recently published an e-mail suggesting that the money was transferred after late Carinthian Alliance for the Future of Austria (BZÖ) Governor Jörg Haider sent a brief e-mail to Kulterer, urging him to give the green light.Kulterer stressed that it was the responsibility of HGAA’s Austrian business operations department whether to provide Styrian Spirit with a credit or not. He also said in a recent interview he never trusted nor befriended Haider. The banker claimed their relationship was a distant and difficult one.Kulterer is the only person suspected of illicit operations in connection with the near collapse of HGAA and who was put in custody. The ex-Raiffeisen manager spent three months behind bars last year as dozens of policemen, financial market experts, prosecutors and government officials investigated the developments at the bank under his reign. He joined HGAA in 1992. He quit as CEO in 2006. HGAA was taken over by Germany’s Bayerische Landesbank (BayernLB) the following year.The court announced yesterday Kulterer was not guilty of embezzlement since he had no chance to influence credits handed out by HGAA Austria since he headed the bank’s international operations at that time.Judges argued in the same way considering a loan of 150,000 Euros to Dietmar Guggenbichler. The bankrupt private detective was a close friend to Haider who reportedly called HGAA decision-makers to provide financial support.The court ruled that neither Kulterer nor Xander or Ruhdorfer pressurised HGAA officials in charge with handing out credits when it came to whether Guggenbichler should receive the money.Several columnists branded yesterday’s verdicts – which are not yet legally binding – as a “disaster” and “embarrassment” for investigators who were previously criticised for allegedly focusing on Kulterer too strongly.The case against Kulterer, Xander and Ruhdorfer was regarded as a test run for other possible upcoming trials. Up to 60 businesspeople and politicians may face charges due to their potential involvement in illegal actions at HGAA and the bank’s reportedly lax lending policies in Croatia and other countries in Southeast Europe where it has been doing business.Investigators defended themselves against accusations of making too little progress in working up the case which is widely considered as one of the biggest business crimes of post-war Austria. Austrian authorities were also criticised for setting up special examination teams called SoKo Hypo and CSI Hypo. The decision was regarded as nothing but an attempt to create positive feedback in the public and silence critics who claim little is happening with bringing felons to justice.Kulterer said after the verdict was announced yesterday that the court’s decision helped him to win back trust in the legal system of Austria and its juridical authorities. His lawyer Ferdinand Lanker announced plans to demand back the bail of 500,000 Euros which was paid to get Kulterer released from custody last November. Lanker added Kulterer – who faced 10 years in jail if found guilty of embezzlement – had plans to demand for additional financial compensation for the time he spent behind bars. The advocate stressed that his client would give the money to charity.Kulterer will be in court again later this year since he is also accused of making a false statement when being questioned by a special committee at the provincial parliament of Carinthia about business operations of HGAA in 2007.