He seems to doubt that the firm would even be bankrupt were it not for the run on its liquidity. The author portrays Prokon not as a ponzi scheme, but as a firm that has actually paid all of its bills up to now, but has run out of liquidity because so many investors want out. Another article ( in German) in German weekly Die Zeit provides a different perspective. Consumer advocates also warned against these investments, though they are not purely Genussrechte, as I explained here.Īn article in Der Spiegel makes it sound like Prokon is a typical problem in the wind sector, whereas perhaps Germany should consider getting rid of Genussrechte as a general investment option. The financial scheme is similar to the one proposed by transmission grid operator Tennet for citizen investments in grid upgrades. It is possible to lose the entire investment.”Įssentially, you get a share of the profits – or nothing, if there are none. The return is often quite high, but all other creditors are served first in the case of insolvency or liquidation before holders of Genussrechte are paid back. (As the consumer advocates point out, Prokon was offering six percent.)īut Prokon was selling “Genussrechte,” a type of investment that – according to the German Wikipedia article – “only exists in Germany, Austria, and Switzerland.” Logically, there is no link to an equivalent Wikipedia entry in English, but it is worth reading the second half of the first paragraph (my translation): In such cases, investors are true shareholders they own a stake in the turbines, and if there is enough wind they receive profits generally calculated at 5-7 percent, the target return for feed-in tariffs in Germany. In April 2011 and again in 2012, consumer advocates pointed out – based on court rulings, which found that the firm was misleading investors – that Prokon was not selling shares in community-owned wind projects, as many investors apparently expected. Last year, they also began asking for their investments back – so many at a time, that the firm seems to have run out of liquidity.
PROKON WIKI TV
I figured that, given the small returns possible from feed-in tariffs for wind power, a large share of the profits was probably going to TV ads now.
The ad is still up at YouTube (uploaded in June 2011), and even if you don’t speak German you can still marvel at the marketing prowess as a nuclear symbol turns into rotating wind turbine blades.īut as amazed as I was at the clever advertising, one thing was certain: I was not going to invest in this firm. (Photo by pandrcutts, CC BY 2.0)Īfter the disaster in Fukushima, a company called Prokon started advertising on German television during the prime time. Unclear future ahead for Prokon investors.
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