BERLIN — Michael Koelmel, co-founder of Kinowelt, is facing a nine-year prison sentence on 15 charges of breach of trust, fraud and obstructing insolvency proceedings in connection with the German producer/distributor’s bankruptcy in 2001.
Munich prosecutors demanded the sentence on Tuesday as the three-month trial draws to a conclusion.
The Munich District Attorney’s Office alleges Koelmel transferred millions of euros to private bank accounts held by himself and his wife and also moved large sums of money from Kinowelt to his sport licensing company Sportwelt, whose mismanagement obstructed the company’s insolvency proceedings, according to prosecutors.
Koelmel said Kinowelt had planned to take over Sportwelt to augment its film licensing business with sports rights. Although the purchase was never finalized, prosecutors said Koelmel illegally obtained E15.3 million ($19 million) from Kinowelt for the purchase.
Kinowelt never received any of Sportwelt’s assets, however. Prosecutors said that alleged act alone was enough to warrant a five-year sentence.
Koelmel maintains his innocence. He argued that the sale of Sportwelt to Kinowelt had been greenlit by the company’s supervisory board.
Michael and brother Rainer Koelmel founded Kinowelt in 1984 and floated it on Germany’s Neuer Markt in 1998. The cash infusion led to a quick expansion, but high-priced shopping sprees sank the company three years later.
The Koelmels managed to buy back the bankrupt company’s assets last year after a prolonged process that was hampered by Michael Koelmel’s legal problems.
The court is expected to deliver its verdict on Thursday.