In fact, things could hardly have gone better lately for Düsseldorf securities specialist Lang & Schwarz: the operator of the listed trading platform and the derivatives trader had benefited significantly from the boom in the stock markets and the fact that suddenly many more private clients were trading in derivatives in Germany. In 2020, the company announced its most successful commercial year in its history. Between early 2020 and early 2021, the stock market price of the securities specialist was multiplied by thirteen. And the success has continued so far into the New Year.
On Wednesday, however, Lang & Schwarz stock temporarily fell 36.5% to 81.60 euros. The company had announced the night before that the general meeting scheduled for Thursday should be postponed shortly. In the background, a tax audit as part of criminal tax investigations, the company announced, but without specifying a new date. The fiscal years 2007 to 2011 would be examined as part of the tax audit, according to the Lang & Schwarz announcement.
There is a suspicion that those responsible for the company have illegally offset or refunded capital gains taxes and solidarity supplements unpaid during these years. On Monday evening, an interim report from the tax office for criminal tax matters and tax inquiries in Düsseldorf on a tax review of the Lang & Schwarz Aktiengesellschaft capital gains tax credit for the financial years 2008 to 2009 was received. It was therefore necessary to postpone the general assembly. A report for the remaining years concerned is still pending and the review has not yet been completed. The company did not say exactly what the audit was about, but the focus should be on cum-ex transactions – that is, transactions in prohibited shares at the expense of the public purse. Until now, it was not known that Lang & Schwarz had participated in these transactions in any way.
The management committee considers that the allegations “in accordance with a group audit which ended in 2015 without any complaint” are generally unfounded. However, “the behavior of Lang & Schwarz Aktiengesellschaft and its responsible persons may be assessed differently from a tax point of view” and changes may be issued. The company therefore wishes to set aside 45 million euros. This provision must be made up of the consolidated result for the first half of 2021, but will have an impact on the payment of the dividend expected for 2021. The result could now be 61 million euros lower.