The bankrupt IT Factory’s CEO Stein Bagger has been formally charged in
absentia in Denmark with fraud and forgery. Bagger’s whereabouts are
The court in the Copenhagen suburb of Lyngby ordered Thursday that Bagger
should be detained, paving the way for an international arrest warrant. To
date, Bagger has only be sought by Interpol as a result of his wife
reporting him missing.
According to the Economic Crimes Squad, Bagger is
alleged to have falsified leasing contracts in 2007 and 2008 in order to
draw one billion kroner from banks in Denmark and abroad. He is also alleged
to have defrauded Sweden’s SEB Bank of DKK 51 million.
In both cases Bagger is alleged to have forged the signature of IT Factory
Board Chairman Asger Jensby.
The allegations were put forward at a closed-door
court hearing in Lyngby where the Public Prosecutor for Economic Crime had
asked to have Bagger’s charges presented in absentia.
Attorney Jesper Madsen was appointed to defend the IT Factory CEO.
Stein Bagger has been missing since he left his
hotel in Dubai a week ago. During the weekend IT Factory management claimed
it had discovered false leasing contracts in a secret office used by Bagger.
According to media reports, Bagger is alleged to have built up a leasing
circus designed to show major turnover and profits in the IT Factory - but
which, in fact, had no base in any real assets.
In one example, a partner sells hardware for a hosting centre to the IT
Factory. Funds for the purchase are borrowed through a leasing company,
which pays out DKK 51 million to be paid over 36 months. The partner then
buys licenses from the IT Factory, ensuring a good turnover.
The leasing roulette provides a large flow of funds and the ability to pay
leasing companies back - for a time.
The merry-go-round appears to have been almost the entire turnover of the IT
The trustee in IT Factory’s bankruptcy estate, Bo Frederiksen, has said that
Stein Bagger appeared to be the only person involved in the fraud.