Warren Buffett, world’s fourth wealthiest man has been swindled by a German manufacturing company of €643million.
This happened when the normally shrewd investor was made to pay four
times more than he ought to have paid to buy Wilhelm Schulz, a
family-run manufacturer of stainless steel based in Krefeld, western
According to the finding of a New York arbitration court, Buffett’s
company, Precision Castparts Corp ought not to have paid more than €156m
for the German firm.
It ordered Schulz to make up the difference of €643m.
After the ruling in the US, a state prosecutor in Düsseldorf is now
investigating the pipe maker, under suspicion of severe fraud for
forging documents and falsifying balance sheets.
The forgery was done via Photoshopping of company orders and invoices, giving the notion that the company was doing very well.
In February 2017 a unit of Buffett’s Berkshire Hathaway Inc, Precision Castparts Corp paid €800m (£715m) to buy Wilhelm Schulz.
After an anonymous tip-off by a whistleblower in May the same year,
however, the US holding company began to question whether key documents
had been doctored to create the impression of a booming business.
In reality, the company Buffett had just purchased was struggling and at risk of bankruptcy.
On 9 April a New York arbitration court ruled that the German company
had systematically led investors astray in the run-up to the purchase
and then tried to cover its tracks afterwards.
“This is not a close case,” the panel said in a 132-page ruling. “The
evidence strongly points to fraud, and there is little in the record to
Internal documents cited by the German newspaper Handelsblatt suggest
some of Wilhelm Schulz’s employees inflated the company’s Ebitda –
earnings before interest, tax, depreciation and amortisation – by simply
scanning in letterheads of third companies and Photoshopping them to
create fake orders and invoices.
At least 47 business deals that had helped create the impression of a
company on the up were completely fabricated, said Handelsblatt.
Tola Johnson, Special Assistant to President Muhammadu Buhari on Micro Small and Medium and Medium Enterprises(MSMEs), says 100,000 small businesses will get N50,000 each.
NAN reports that the gesture is part of COVID-19 economic stimulus.
The presidential aide made the announcement at the inauguration of the Implementation of Survival Fund and Guaranteed Off-Take Stimulus Schemes for MSMEs on Thursday in Abuja.
Johnson, the Project Coordinator, said that the schemes were part of the Economic Sustainability Plan drafted by Vice President Yemi Osinbajo-led committee and approved by President Muhammadu Buhari.
“The Payroll Support targets 100,000 businesses. However, the number of individuals who will benefit from this is 500,000. What the government has done is to say that there a lot of MSMEs that have been affected by the COVID-19 pandemic lockdown.
“Afterward, there is a CAC (Corporate Affairs Commission) free registration; it is free for the MSMEs but the government is paying the CAC for this. What the government has done is to say to the CAC, you do this regularly to the MSMEs at about N12,000 or thereabout; give it to us at half price, we will give it to the MSMEs free.’’
Johnson added that under the National MSMEs Clinic, Osinbajo and the Minister of Industry, Trade and Investment went to no fewer than 26 states.
He said it was discovered that very creative businesses were not registered.
“They will tell you they don’t have N10,000 to N12,000 to register their businesses. The government had promised that at some point, we will do and I think the opportunity has come now; the opportunity cannot be better than now.’’
The official also announced that under the Survival Fund, the last strap would be the Transport and Artisans Support.
At least 333,000 beneficiaries will get a one-off N30,000 grant, Johnson said.
He added that the government will work with associations, individuals and the Ministry of Transportation to implement the scheme.