Vonovia calls in Deloitte to investigate bribery allegations

One of Germany’s largest property companies Vonovia said it had appointed Deloitte to investigate allegations of bribery against several current and former employees after police raided the company’s headquarters.

The company announced the appointment of the Big Four firm late on Tuesday after authorities had conducted a raid on its headquarters in as well as 40 private homes and offices across Germany.

Prosecutors in Bochum said they were conducting an investigation targeting current and former employees of Vonovia, one of Germany’s biggest residential landlords, as well individuals working for the real estate company’s contractors. Four individuals were arrested.

“We are shocked,” said Vonovia chief executive Rolf Buch. “It appears that individual employees at our subsidiaries have accepted bribes to the detriment of Vonovia — that is not acceptable.”

Shares in Vonovia, which has a market capitalisation of €19bn, dropped more than 5 per cent on Tuesday.

According to Bochum prosecutors, Vonovia employees are suspected of giving preferential treatment to contractors in exchange for kickbacks, adding that they suspected documents were manipulated to justify excessive invoices.

Vonovia has expanded aggressively over the past couple of years, including buying Berlin-based rival Deutsche Wohnen in 2021. However, the group’s shares have tumbled by almost half over the past 12 months as rising mortgage rates and inflation put the brakes on Germany’s housing boom.

In a statement, the company said it was “co-operating fully” with authorities and had already implemented “initial personnel measures” and intended to press charges against suspects.