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🇦🇹 Austria /Economy & Trade

Kika/Leiner bankruptcy: Former chief executive held in custody over suspected fraud

From Die Presse · () German

Translated from German and summarized by DistantNews. Read the original for the full story.

At a glance

Newswire Official statement In the courts
  • Former Kika/Leiner managing director Hermann W. was arrested on Aug. 28 and placed in pretrial detention two days later over suspected fraud.
  • Prosecutors suspect damages of about €15 million and allege that he exploited flood victims through a discount campaign.
  • They also suspect he moved company assets shortly before insolvency to reduce creditors’ recovery.

The collapse of Austrian furniture retailer Kika/Leiner has led to the detention of its former managing director, Hermann W., over suspected fraud involving an alleged €15 million loss.

Hermann W. was arrested on Aug. 28 and has been in pretrial custody since Aug. 30, the Economic and Corruption Prosecutor’s Office confirmed after a report by Kurier. The case was transferred from the public prosecutor’s office in St. Pölten.

The accused is strongly suspected of deliberately exploiting the plight of flood victims in September 2024.

— Economic and Corruption Prosecutor’s OfficeThe prosecutor’s office described the suspected conduct behind the emergency discount campaign.

Prosecutors suspect Hermann W. deliberately exploited the plight of people affected by floods in September 2024. Through a social media campaign advertised as emergency storm assistance, customers were promised a 20 percent discount on furniture purchases. Investigators believe the campaign aimed to generate cash through advance payments.

As part of an advertised emergency storm assistance campaign on social media, customers were promised a 20 percent discount on furniture purchases in order to quickly generate liquid advance payments.

— Economic and Corruption Prosecutor’s OfficeThe statement outlined how prosecutors believe the campaign generated funds.

The authorities also suspect that company assets were deliberately moved shortly before insolvency proceedings began. They say the alleged transfers may have prevented or reduced payments to the many creditors involved in the insolvency case before the St. Pölten regional court.

Signa, the property group formerly associated with René Benko, sold the Kika/Leiner properties to Graz-based developer Supernova in 2023. It sold the operating furniture business to Hermann W. The company soon entered insolvency for the first time. After a second insolvency in November 2024, W. could not secure new financing or an investor.

There is also strong suspicion that, shortly before insolvency was opened, the accused deliberately moved assets of the furniture chain aside in order to thwart or reduce the satisfaction of the many creditors in the insolvency proceedings before the St. Pölten regional court.

— Economic and Corruption Prosecutor’s OfficeThe authorities described the second suspected element of the case.
About this summary

Originally published by Die Presse in German. Translated, summarized, and contextualized automatically by DistantNews, with a note on how the source frames the story. Not individually reviewed before publishing. How this works.

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