Two employees of Deutsche Bahn allege that some officials working for a state-owned railway company misused the company’s funds as part of a rampant fraud in one of Europe’s largest construction projects.
While the investigation was underway, one of the workers was fired. Fearing retaliation, the journalist suddenly stopped talking to law enforcement officials.
The allegations and their findings – which the Financial Times investigation revealed through the press and interviews with people who are familiar with the matter – add to the controversy over Germany. very expensive and a collaborative project, a new subway line in Stuttgart.
This complex plan – called Stuttgart 21 – is funded by the German government, the EU, the Baden-Württemberg government and the city of Stuttgart. It has been overseen since 2017 by former Angela Merkel chief of staff Ronald Pofalla, who is now the head of Deutsche Bahn.
Stuttgart 21 is well-known for its delays and budget expenditures, putting it on a notable list near Berlin airport and Elbe Philharmonic Hall in Hamburg.
The initial price of € 2.5bn has risen to € 8.2bn. In 2016, Germany Bundesrechnungshof, the largest government agency in the country, warned that the cost could rise to € 10bn and criticized the Merkel government for “serious mistakes” in its management.
FT can now reveal that in 2016 the department tracked by Deutsche Bahn received repeated warnings from within the company that a significant portion of inflation had begun due to poor performance and suspicion of corruption.
A whistleblower claims that the alleged wrongdoing resulted in € 600m spending unnecessary money on Deutsche Bahn. All media outlets reported that some senior executives had ordered work to be done on less important occasions and were under suspicion of receiving money.
“Public research needs to be done promptly and decisively! Follow-up should determine who receives the benefit from the behavior, “one historian warned in July 2016 in letters seen by FT.
Deutsche Bahn is a € 40bn annual government giant owned by a UK bus operator in Arriva. An unnamed group is on fire in Germany due to unemployment, frequent delays and banned trains. In 2020, it also reported that € 5.7bn and € 37bn in debt were all lost.
Stuttgart, the capital of Baden-Württemberg, is the sixth city in Germany and home to Daimler and Porsche car manufacturers. Situated in a narrow valley surrounded by mountains, its climbing has become a barrier. By the end of 2025, underground stations, 28 tunnels and 117km of new runways will reduce travel time between the cities of Stuttgart and Ulm.
But the project – first organized in 1994 – was met with serious protests. Locals have protested the slightest demolition of the aforementioned station building, deforestation in the city center park, rising costs and years of construction work. In 2010, police used a water rifle to protest protesters, one of whom was slightly blind.
The two who reported the matter were the engineers who worked on the project. One was a team leader and a fundraiser who joined Deutsche Bahn in 1997. The other, who was fired during the study, joined in 2013.
One example of the unnecessary work mentioned in the complaint was the power plant that was not part of the original plan. One of the engineers was forced by the authorities to pay a € 2.5m contract for his construction, although the alternative was only € 30,000. At the ceremony, the engineers stood up and the cutting path was removed, according to someone familiar with the matter.
Defendants allege that some officials in Deutsche Bahn neglected their obligation to reimburse certain fellows in accordance with German law: for example, to relocate a neighboring subway station, whose funds would be distributed by municipalities. . Defendants suspected that the behavior was intended to prevent their friends from realizing that money was being spent unfairly.
The staff expressed their concerns internally. When the authorities fired them, even though both of them viewed it as evidence of unnecessary tenders and violations of fiscal rules, they began to suspect that the managers were deliberately ignoring the mistakes.
Twenty years ago, a fraudulent plan to renovate Leipzig station became known after the company that was asked to pay the bribe reiterated Deutsche Bahn’s demands. The fraudulent manager, who was named after “Mr Three Percent” when he insisted on returning 3 percent of the invoices, was later arrested.
Deutsche Bahn said an internal investigation into the complaints of Stuttgart whistleblowers was launched in early 2016 and closed after more than a year of finding nothing.
“All the allegations that were allegedly investigated were investigated by an internal investigation team and investigated by the security team and it was not confirmed that they were true,” the company said. It declined to comment further on the extent of the investigation and its methods, only to do so “in accordance with internal rules and regulations”.
The appraisal expert summarized their concerns on a four-page page of July 11 2016 – the date of the intermediate meeting between the two lawyers and staff in Stuttgart. The Memo stated that “unauthorized and inappropriate conduct” including “unauthorized payment, an anonymous arrangement.[and]a disturbance in the organization “means that the company” has been deprived of € 600m for no reason “.
According to experts, the comparison was based on detailed calculations by a budget expert, based on a list of all construction projects involving other government agencies, and the costs that Deutsche Bahn can legally claim from them. but he did not.
The plaintiff’s statement also stated that his secretary had been repeatedly harassed and criticized by officials who demanded that the wrong decisions be repeated.
It is not known how this memo was distributed in Deutsche Bahn. Three people familiar with the matter confirmed that it was true, two of them adding that subsequent staff members were closely followed by its author.
The company told FT it did not have any such documents but declined to comment if it was aware of the prosecutor’s estimate of € 600m. The letter writer took part “briefly” at the July meeting, the company said, adding that the man “had not completed July 2016”.
Some people familiar with the matter told FT that the two had been in close contact and follow-up since December 2015, and prior to July 2015 they had organized two meetings to deal with investigators and internal investigators, which for various reasons did not happen as planned. Deutsche Bahn told FT that it had found this “mysterious” scene “, adding that we were” denying it “.
A few weeks after the first follow-up meeting in January 2016, one of the defendants received written warnings for minor offenses such as late note-taking. In December 2016 the fortune teller was fired.
The employee filed a grievance against the dismissal of the employee in 2017. After returning to work a year later, the employee was dismissed again for some misconduct. During the ensuing several-year dispute, the judges repeatedly ruled that a second term had been imposed. However, a Stuttgart judge agreed with the Deutsche Bahn’s request to cancel the deal, saying that trust had been broken.
Deutsche Bahn said the actions of the employee are not necessarily linked to the complaints they disclose, noting that they refer to misconduct related to the work. The Stuttgart Court in July upheld the decision.
Deutsche Bahn confirmed that the second historian was out of action after the July meeting. Experts say the prosecutor is afraid of retaliation and believes there is no desire to investigate the allegations. Deutsche Bahn declined to comment on the reasons for the change of heart, but said the man was still working.
The company told FT that “the safety of whistleblowers who act in good faith is paramount”, adding that its successive approach was “high-quality, fully efficient and consistent with high expectations”.
In contrast, both staff members suspect that their information was disclosed to the project management superintendents unnecessarily, according to the report. Deutsche Bahn has strongly denied that it exposed the whistleblowers inside.
Two whistleblowers, known as FT, declined to comment.