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1928 Liechtenstein embezzlement scandal

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Anton Walser, considered the main participant in the scandal.

The1928 Liechtenstein embezzlement scandalwas a scandal involving leading members of theChristian-Social People's Party,where it was revealed that they hadembezzledfunds from theNational Bank of Liechtensteinfor various speculative transactions. The scandal forcedthe governmentofGustav Schädlerto resign andearly electionsto be called.[1]

Background[edit]

Starting from 1926, leading members of the Christian-Social People's Party, Franz Thöny,Anton Walser,Niko Beck, and Rudolf Carbone embezzled funds from the National Bank of Liechtenstein for various speculative transactions.[1]This included the expansion of the class lottery in Liechtenstein andRomania,which was operated by Walser and had the legal representation ofPresident of the Landtag of LiechtensteinWilhelm Beck,[2]who was also chairman of the bank's board of directors.[3]The program promised high income and employment for Liechtenstein, though proved controversial within both theLandtag of Liechtensteinand the general population.[2]

Arrests and investigations[edit]

In June 1928, Walser, Niko Beck and Franz Thöny were arrested, with Rudolf Carbone being arrested in June 1929. In November 1929, Walser, who was responsible, was sentenced to four years in prison, with the rest being sentenced to three.[1]

Johann IIand theProgressive Citizens' Partyblamed the Christian-Social People's Party and the government ofPrime Minister of LiechtensteinGustav Schädler for the scandal, as the men arrested were members of the party and Walser himself was the party's president. As a result, in June 1928 Johann forced Schädler's government to resign and early elections were called, withPrince Alfred of Liechtensteintemporarily acting as Prime Minister.[1]Schädler was not barred from re-election, but the1928 Liechtenstein general electionresulted in a win for the Progressive Citizens' Party and he was succeeded byJosef Hoop.[1][4]

In 1931, anindictmentwas conducted against Schädler in the State Court of Justice for violating supervisory and official duties in the administration of the savings bank.[5]However, he wasacquitted,partly because thestatute of limitationshad expired and partly because the breach of duty was not due togross negligence.[4]In 1932, a similar indictment was laid against Wilhelm Beck for violating supervisory and official duties in the administration of the board of the directors of the National Bank of Liechtenstein. This resulted in him being ordered to pay damages in 1935; though he appealed this ruling, he did not live to see the outcome.[3]

The Christian-Social People's Party accused government councillorPeter Büchelof being complicit in the scandal, but he immediately demanded an investigation and wasacquittedof all allegations.[6][7]

Aftermath and legacy[edit]

Johann II assumed responsibility for the losses caused by the embezzlement, and donated one millionSwiss francs.Local communities pledged their land for a week in order to support economic recovery. In addition, another two million francs was taken out as a loan fromSwitzerlandin order to restructure the National Bank - the equivalent of two yearly budgets.[1]

The Christian-Social People's Party believed that they had felt treated unfairly by Johann II, and the party remained alienated from him for the rest of his reign; this tension continued under his successorFranz Iand the successor partyPatriotic Union.[1]The rift between the prince and the party would not be resolved until 1938 withFranz Joseph IIascending to the throne and the formation of a coalition government between the Progressive Citizens' Party and Patriotic Union.[8][9]

The scandal greatly undermined the political power of the Christian-Social People's Party and later Patriotic Union in Liechtenstein politics, with it being used as proof of alleged incompetency of the party.[1]The party would not form its own government again until 1970 underAlfred Hilbe.[10][11]

References[edit]

  1. ^abcdefghBüchel, Donat (31 December 2011)."Sparkassaskandal".Historisches Lexikon des Fürstentums Liechtenstein(in German).Retrieved17 May2023.
  2. ^abQuaderer, Rupert(31 December 2011)."Klassenlotterie".Historisches Lexikon des Fürstentums Liechtenstein(in German).Retrieved17 February2024.
  3. ^abLeipold-Schneider, Gerda (31 December 2011)."Beck, Wilhelm".Historisches Lexikon des Fürstentums Liechtenstein(in German).Retrieved30 September2023.
  4. ^abQuaderer, Rupert(31 December 2011)."Schädler, Gustav".Historisches Lexikon des Fürstentums Liechtenstein(in German).Retrieved18 May2023.
  5. ^"Der Landtag behandelt das Urteil des Staatsgerichtshofes über Alt-Regierungschef Gustav Schädler in Sachen Sparkassaskandal".Staatsarchiv des Fürstentum Liechtenstein(in German). 14 January 1932.Retrieved20 August2023.
  6. ^Büchel, Donat (31 December 2011)."Büchel, Peter (1872–1958)".Historisches Lexikon des Fürstentums Liechtenstein(in German).Retrieved25 September2023.
  7. ^"Der Staatsgerichtshof entlastet Peter Büchel im Disziplinarverfahren wegen des Sparkassaskandals vom Vorwurf des pflichtwidrigen Verhaltens".Staatsarchiv des Fürstentum Liechtenstein(in German). 16 January 1932.Retrieved30 September2023.
  8. ^"Liechtenstein's Prince Franz Josef II, 83".Los Angeles Times.15 November 1989.Retrieved17 May2023.
  9. ^"Parties in Liechtenstein 1921-1943".Prince and People: Liechtenstein Civics(in German). 2007.Retrieved16 May2023.
  10. ^"Liechtenstein's Voters End 32-Year Coalition".The New York Times.2 February 1970.Retrieved16 May2023.
  11. ^Marxer, Wilfried (31 December 2011)."Patriotic Union (VU)".Historisches Lexikon des Fürstentums Liechtenstein(in German).Retrieved14 May2023.

Further reading[edit]

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