KEMPINSKI Hotels has filed criminal charges against its former president and CEO, Swiss-born Reto Wittwer, for alleged fraud and professional misconduct.
Filed in Switzerland, Wittwer was alleged to have channelled funds out of the company “with fraudulent intent and avoiding all internal controls”, including during periods when Kempinski was attempting to make budget cuts and drastic savings on labour costs.
Alejandro Bernabé, CEO of Kempinski, said: “Kempinski, and everyone associated with the company, have been badly let down by someone in whom we placed our full trust. The high responsibilities of executive office and the fundamental values on which Kempinski has carefully built its business have, we believe, been deliberately flouted in the pursuit of personal greed and unlawful gain. We are treating this matter with the utmost seriousness.”
The group said that the decision to take legal action followed a full internal investigation conducted by a third party. “As soon as the company became aware of the suspected fraud, Kempinski conducted a thorough review of its internal controls,” the company said. “A number of changes in terms of internal audit and compliance have been made.
“Kempinski has entire confidence in the Swiss criminal authorities with whom the complaint has been filed, and will fully support the authorities as the criminal complaint follows its due course.”
Kempinski announced on October 30, 2014 that Wittwer had retired after 19 years in the role. In that announcement, it gave a glowing account of Wittwer: “When he joined Kempinski Hotels in 1995 as president & CEO, Wittwer was clear in his vision to grow Kempinski’s portfolio internationally and build the brand. In the nearly 20 years since he was appointed, Wittwer has succeeded in turning around the fortunes of the group, by focusing its offering on luxury hotel management services, and realising an ambitious yet highly selective expansion strategy, growing the portfolio from 21 hotels to the 73 under operation today, with a further 35 under construction or final development. He credits the success of this strategy to the group’s shareholders, who have focused on long-term growth and returns. Today, Kempinski has a truly international portfolio, having entered many markets as pioneers, and recorded the group’s best financial performance in 2012 and exceeded this again in 2013.”
Michael D Selby, chairman of the Supervisory Board of Kempinski, had said: “It’s nearly two decades since the shareholders of Kempinski asked Mr Wittwer to make a long-term commitment and help make our joint vision a reality. He’s steered the group through challenges, which other competitors have failed, and Kempinski has weathered the economic crisis thanks to our business model of pure management agreements for hotels in Kempinski’s portfolio. Mr Wittwer really has been part of making Kempinski Hotels the successful company and respected brand it is today. The Supervisory Board of Kempinski AG thanks Mr Wittwer for having dedicated so much of his career to the group, we hope he will stay close in his new role as president emeritus, despite going into a very well deserved retirement.”
However, it has now emerged that Wittwer was asked to leave the company “with immediate effect” after initial suspicions of professional misconduct came to light.
Wittwer could not be reached for comment.
Wittwer was no stranger to Asia, working in the region in his early career days. In 1976, he was director of F&B of The Mandarin Singapore. Two years later he moved to the Peninsula Group in Hong Kong as resident manager. In March 1979 he joined Hyatt International in the capacity of general manager and worked in Canada, Mexico and Indonesia.
Since 2004, a majority stake in Kempinski has been owned by the Thailand Crown Property Bureau. Today, the company is largely a hotel management business, although it continues to own the Hotel Vier Jahreszeiten in Munich, while holding lease contracts on Hotel Adlon in Berlin, Palais Hansen in Vienna and the Grand Hotel des Bains in St Moritz.
Kempinski currently operates 78 hotels in 33 countries During the last 12 months, Kempinski has opened seven hotels in Myanmar, China, Qatar, Germany, Egypt and Ghana, with a further five expected to open during 2016.
