Kadewe group under suspicion of fraud: Investigations in Berlin running!

Kadewe group under suspicion of fraud: Investigations in Berlin running!

In 2024, the bankruptcy of the Kadewe Group is becoming increasingly a financial burden for Berlin. At the beginning of the year, the prestigious retail company registered bankruptcy after it had come into the slide strudel of the Signa Group. According to a report by RBB24, the Signa Group and its subsidiaries are investigated on suspicion of subsidy fraud, which also complicated the situation. A spokesman for the Berlin public prosecutor's office, Sebastian Büchner, confirmed that the investigation also affects the Kadewe Group, but a connection to a 90 million euro loan that was secured by a guarantee of the federal and state governments was not clearly determined.

Particular attention is paid to the financial consequences that arise from bankruptcy. In the end, the state of Berlin could pay up to 18 million euros for the repayment of the Corona aid loan, as N-TV reported. This loan was originally approved to cushion the economic failures during pandemic. While the federal government took over 50 % of the risk, Berlin is responsible for 32.9 %. So far, however, only part of the guarantee has been redeemed. According to the Federal Ministry of Economics, the actual burden for Berlin could now only be around 2.2 million euros, since the recovery of the collateral can be expected to have a much lower failure rate than was originally feared.

Current developments

The Kadewe Group applied for Corona aids of 52 million euros in 2021, which were linked to certain conditions. Interestingly, the Kadewe Group claims that repayments have already been made "at a relevant amount" to the lenders. However, this data is contrasting to the reports on the outstanding amounts of over 55 million euros. The Berlin financial administration emphasized that before a default guarantee could be claimed, the existing collateral must first be exploited. A claim from bankruptcy alone does not justify the guarantee. However, it is clear that the financial challenges of the Kadewe group will have an intensive impact on Berlin, as the announcements of those responsible show.

The situation around the KadeWe group is therefore becoming an important topic, not only for the company itself, but also for the financial situation of Berlin. While the investigation against the Signa Group is more and more soaked, the state funds are on the brink, which only increases the interest of the public in the progress of this story.