Neitzel & Cie.: MS Cornelia Sold from Insolvent Ship Fund

Since the beginning of the year, the MS Conny Schifffahrtsgesellschaft mbH & Co. KG (a shipping company) has been the subject of insolvency proceedings (Az.: 504 IN 16/15). The fund vessel MS Cornelia now appears to have been sold.

Neitzel & Cie. had created the ship fund MS Cornelia at the end of 2007 and conducted most of the marketing in 2008. Investors were able to acquire a share in MS Conny Schifffahrtsgesellschaft mbH & Co. KG assuming a minimum investment of 15,000 euros. However, the company filed for insolvency at the end of last year and the main insolvency proceedings were initiated before the Amtsgericht Bremen (Local Court of Bremen) in January. Despite the fact that the fund vessel MS Cornelia appears to have been sold according to information provided by fondstelegramm, the investors should continue to anticipate financial losses.

In order to avert financial loss, the investors in question can turn to a lawyer who is versed in the fields of banking and capital markets law. He can review the legal options and, where appropriate, assert claims for damages.

Such claims may result, for instance, from inadequate or erroneous investment advice. At the time when investment in the ship fund Neitzel & Cie. MS Cornelia was being predominantly marketed in 2008, the crisis that was setting in concerning commercial shipping during the course of the financial crisis was already foreseeable. The accumulation of overcapacities gave rise to several ship funds experiencing economic difficulties, with these frequently leading to insolvency. Notwithstanding this, ship funds were often presented as safe, high-yield capital investments in the context of investment advice.

However, proper investor- and issue-specific advice also ought to involve comprehensively informing the investors about the risks, because investors in acquiring shares in a fund are generally making commercial investments and are thus subject to commercial risk. They could end up losing all of their investment. Nonetheless, this was often concealed or insufficiently explained during consultations. This kind of inadequate or erroneous advice can give rise to damages claims.

This is also the case if the intermediary banks have failed to mention their reimbursements, i.e. so-called “kick-backs”.

GRP Rainer LLP is an international firm of lawyers and tax advisors who are specialists in commercial law. The firm counsels commercial and industrial companies and corporations, as well as associations, small- and mid-sized businesses, self-employed freelancers and private individuals worldwide from offices in Cologne, Berlin, Bonn, Dusseldorf, Frankfurt, Hamburg, Munich, Stuttgart, and London UK.

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Disclaimer: While every effort has been made to ensure the accuracy of this publication, it is not intended to provide legal advice as individual situations will differ and should be discussed with an expert and/or lawyer. For specific technical or legal advice on the information provided and related topics, please contact the author.

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