Barclays Sued Over K1 Fraud

Jan 17 2013 | 1:40pm ET

Barclays may be among the biggest losers in the K1 Group hedge fund fraud, but that hasn't stopped other victims from suing the bank over it.

Some 150 lawsuits have been filed against the bank in Germany by K1 investors, a lawyer for those investors said today. Another 220 claims could eventually be added; they are currently in mediation, Klaus Nieding said.

"Barclays in a big way distributed so called X1 certificates by" K1 founder Helmut Kiener, who admitted to running a €345 million fraud and was sentenced in 2011 to more than 10 years in prison, Nieding said. "We estimate the total volume of certificates with Kiener products issued by Barclays at €300 to €400 million."

Barclays called the lawsuits "wholly without merit."

"The German courts have found in Barclays' favor in all decisions to date with a recognition that Barclays is also a victim of the Kiener fraud," Barclays spokesman Jon Laycock said.

Barclays and BNP Paribas, K1's bankers, suffered losses of €223 million in the scheme, with Barclays taking the lion's share of those losses.


In Depth

Q&A: Reg A+ Will Transform the Alternative Asset Landscape

Jul 7 2015 | 4:03pm ET

In addition to easing capital formation for small companies, Regulation A+ has enormous...

Lifestyle

Fiat Chrysler Files Paperwork For Ferrari IPO

Jul 23 2015 | 5:05pm ET

Italian sportscar maker Ferrari has taken a step closer to a stock market listing...

Guest Contributor

Lifting of Foreign Ownership Limits Signals Sea Change in Vietnam's Capital Markets

Jul 28 2015 | 3:01pm ET

The lifting of restrictions on foreign ownership limits in Vietnam later this year...

 

Editor's Note