Duesseldorf prosecutors confirm investigation against Solar Millennium's founder - report

Aug 24, 2011 - The Duesseldorf prosecutors office has affirmed that it had initiated an investigation on accounting fraud against Hannes Kuhn, founder and supervisory board member of German solar firm Solar Millennium (ETR:S2M), Der Spiegel reported.

Kuhn as well as two associates are accused of falsifying the balance sheet of DM Beteiligungen AG in the period between 2002 and 2006 and therefore misleading around 9,000 investors who subscribed for securities of more than EUR 143 million (USD 206.8m).

According to a Duesseldorf court judge, in 2006 when DM Beteiligungen filed for insolvency, a total of EUR 90 million of the money was missing.

The new investigation against Kuhn comes in addition to an already initiated probe on suspicion of insider trading. Solar Millennium's founder is accused of buying company's shares right before the appointment of CEO Utz Claasen, which caused a significant rise in Solar Millennium's share price.

On the other hand, there is an already ongoing lawsuit against former CEO Utz Claasen, who was appointed as CEO in January 2010 but left the company after 74 days. Solar Millennium demands a repayment of the EUR 9 million he received as an advance payment for five years ahead.

These negative news combined with the company's announcement that its Blythe solar thermal power project in California will be converted into a photovoltaic (PV) technology power plant provoked significant worries among investors in the last weeks. Solar Millennium's share lost more than 60% of its value on the stock exchange within a month.

(EUR 1.0 = USD 1.446)

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