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Helmut Kiener Florian Guldner, Opalesque Germany:

More bad news for investors in Helmut Kiener's K1 Global and K1 Invest funds: German newspaper Sueddeutsche Zeitung reported yesterday that the funds' liquidator Grant Thornton had sent letters to investors of both funds, explaining that there is no capital left and that they were exploring 'third party options' to cover the liquidation expenses.

Grant Thornton is now targeting investors that withdrew money before the funds shut down this year, which might affect a number of retail investors. Legal expert Peter Mattil advises K1 investors not to make any payments in that case, as the claims would violate private international law.

According to Mattil, there might be an additional problem for German investors on the way: German authorities are taxing profits even when they turn out to fake profits that were not paid out.

Kiener was arrested in October 2009. Prosecutors accused him of defrauding several banks of a total of €280m (now $401m). Germany's financial markets regulator BaFin had already banned Kiener from being involved in the management of financial portfolios in 2001. See our October 29 coverage here and our October 30 coverage ......................

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