2Birds lawyers arrested and office searched
21 October 2016
Police have searched the Hamburg office of Bird & Bird and arrested two of its lawyers in connection with a muti-million euro embezzlement.
2Birds counsel Dr. Ole Brühl and former partner Frank Moerchen were initially called as witnesses last year in the trial of their client Heinrich Schulte, the ex-chief of German real estate fund Wölbern. Schulte was found guilty of embezzling approximately €147m of Wölbern funds between 2011 and 2013 by transferring them to a Dutch limited company he had set up. He was sentenced to eight and a half years in prison.
During his trial Schulte insisted that he was innocent and that Brühl and Moerchen advised him to move the monies and were integrally involved in the scheme. Now they have both been taken into police custody, accused of complicity in the embezzlement. According to German legal news website JuVe
, they are being kept in jail due to the risk they might abscond.
'Cos it'll get a reduced sentence
Last week the firm's Hamburg office was also searched by police. While it is embarrassing for the firm that its lawyers have been arrested and its filing cabinets examined, it could also be expensive. 2Birds is subject to an ongoing €130 million claim for professional negligence being brought by shareholders in the fund. They allege that Brühl and Moerchen acted negligently, and potentially criminally, in enabling the transfer and advising investors that the transactions were legal and in the fund's best interests. Their arrest will have the firm and its insurers popping a vein.
A spokeswoman for Bird & Bird said, “We are cooperating fully with the authorities in this matter