The Berlin public prosecutor has closed the investigation against him on suspicion of budget infidelity. Corresponding Tagesspiegel information confirmed a spokesman on Monday. Accordingly, Schmidt’s breaches of duty are not significant enough from the point of view of the public prosecutor, nor do they want to recognize any damage.
On the other hand, the Berlin audit office had attested Schmidt “improper exercise of pre-emptive rights” of the district when acquiring several rental houses. Because Schmidt had insufficiently checked the lack of financial strength of “Die eG” and thus violated building law, the district had a liability risk of 27 million euros and payment obligations of 270,000 euros.
The newly founded “This eG” had taken over financially in 2019 through the purchase of several houses previously rejected by state-owned housing companies and was facing bankruptcy. By intervening by the Senate in funding guidelines, “Die EG” was saved with state money.
In order to make the business model of the rescued cooperative viable despite state money, the Senate allowed exceptions even before the rent cap came into force – even an increase in rents in the seven rental houses.
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Six of them are in Friedrichshain-Kreuzberg and one in Tempelhof-Schöneberg. The opposition from the CDU and FDP now wants to review the proceedings – ten months before the next parliamentary elections – through an investigative committee in the House of Representatives.