Initial Situation
The debtor’s advertising brochures contained incorrect and misleading information about the use of the funds. F & P Aktiengesellschaft & Co. KG projected yields as high as 18 percent to its investors. In fact, however, the company never generated the promised yields at any time; it merely paid out fictitious profits funded by the contributions of new investors to its investors. A classic Ponzi scheme.
The Insolvency Proceedings
In May 2005, the Federal Financial Supervisory Authority (Bundesanstalt für Finanzdienstleistungsaufsicht; BaFin) ordered the cessation of business operations. The appointed liquidator, attorney Georg Henningsmeier, filed a petition for insolvency with the competent Kassel Local Court in October 2005 after the determining the company’s inability to pay and its overindebtedness. Attorney Jutta Rüdlin became the insolvency administrator. The main focus of the proceedings was to determine the investors’ claims for payment against F & P and to examine challenge claims against investors who had received disbursements of fictitious profits. One hundred thirty-five of the determined challenge claims had to be pursued by legal action.
In the course of the legal proceedings, a decision of the Federal Court of Justice (BGH) of July 18, 2013, File No. IX ZR 198/10 regarding the contestability of the payment of a sham settlement credit under company law as a gratuitous benefit when no income has actually been generated was obtained.
The insolvency administrator drew up a liquidation plan that helped to avoid many years of litigation and made possible a large payout on investor claims.
The Result
The insolvency plan was confirmed by the ruling of Kassel Local Court of 08/28/2009.
Disbursement: €26.6 million to 2,654 creditors
Quota: 50%
Closure of proceedings pursuant to Section 258 (1) InsO: 05/27/2015
