Former Steinhoff directors face trial over $7.2 billion accounting scandal

Two former directors of Steinhoff International Holdings NV’s European units are standing trial in Germany over their alleged involvement in the accounting scandal that rocked the retail giant in 2017. Dirk Schreiber and Siegmar Schmidt are facing charges relating to the irregular transactions uncovered by auditor PwC that amounted to €6.5 billion ($7.2 billion). The trial comes just two weeks after ex-CEO Markus Jooste was also charged over the scandal.

Steinhoff Directors Start German Trial Over Accountancy Scandal

By Karin Matussek and Janice Kew

Two ex-Steinhoff International Holdings NV directors who worked at the retailer’s European units appeared in a German court on Wednesday to stand trial on charges relating to the accounting scandal at the company.

The Regional Court in Oldenburg opened the proceedings on Wednesday against Dirk Schreiber and Siegmar Schmidt, the tribunal’s press office said in an emailed statement. 

The pair stand trial over of the same accounting violations ex-chief executive officer Markus Jooste was charged with in his case that started two weeks ago. Jooste failed to show up in court, and authorities are now deciding on a request to issue an arrest warrant for the 62-year-old.

Schreiber, Steinhoff’s ex-head of finance in Europe, was additionally charged with credit fraud. 

After the indictment was read in the court the case was adjourned. The judges, prosecutors and defense then met for talks about how the trial will proceed, including a potential settlement, a tribunal spokeswoman said by phone.

The two men were among eight people that were named by the company in 2019 following a forensic probe by auditor PwC that uncovered €6.5 billion ($7.2 billion) of irregular transactions with eight firms over eight years.

German authorities first searched the offices of Steinhoff Europe Group Services GmbH two years before the parent company’s 2017 demise. 

Those raids in Westerstede, a small town close to Oldenburg in the North of Germany, were based on suspicions some units may have booked income through sales of assets to other companies which in reality were part of the group. Steinhoff has its roots in the town.

Read also:

© 2023 Bloomberg L.P.