Missing millions

Fourty-six former clients of WGI have alleged that some zł.13 million is missing from their accounts.

The group says there were huge discrepancies between the amounts WGI told its customers they had on account, and the amounts it reported to the Polish Securities and Exchange Commission (KPWiG). "The material we have gathered allows us to put forward a thesis that WGI used double accounting," says Leszek Koziorowski, a lawyer with Gessel, the firm representing the investors.

According to Koziorowski while on March 31 the 46 investors had an aggregate of zł.18 million on their accounts, WGI said this sum amounted to roughly zł.5 million. Koziorowski says that there seems to be no pattern in the discrepancies. "The mechanism of double accounting was completely random," he claims.

The WGI brokerage allegedly transferred money to WGI Consulting, which may have deposited zł.5 million in Wachovia Securities, an American brokerage and financial services firm. It is not known what happened with the other zł.13 million. WGI Consulting is not supervised by KPWiG and hence the way the money was invested could not be controlled.

As the brokerage house had more than 1,000 clients, the question, stresses Koziorowski, is how much money disappeared altogether and where it is at the moment. "About zł. 260 million evaporated, at least," he claims.

WGI management reacted furiously to the allegations. "It is not true that WGI brokerage house conducted double accounting. There was a single consistent book-keeping system," the company wrote in a communique.