European Kings Club, a unique case

In the 1990s, thousands of Swiss invested in a snowball system called the European Kings Club. The investors were promised returns of 70%. The dream of high yields ended in a fiasco for a large part of the investors. The new investors paid the old the net yield and kept thereby the snow ball system over three years on running. The peculiarity of the snowball system was that it had sectarian traits and, in addition to economic interests, a sense of community was crucial for the success of the fraud.

The European Kings Club functions through the sale of so-called "Letters" at a unit price of CHF 1'400, with guaranteed distributions of CHF 200 per 12 monthly installments. The investment in the European Kings Club should therefore generate a return of 70% within one year. But instead of returns, many investors suffered a total loss.

"Around 80,000 investors lost a total of CHF 1.6 billion. In Switzerland, around 20,000 investors invested approximately CHF 280 million. Part of the money could be secured in Switzerland, but a large part of the invested assets trickled away abroad."

The snowball system was characterized by an ideological imprint according to which the European Community and Freemasons would exploit the little man. The club's ideology found fertile ground in Central Switzerland in particular, especially since the Central Swiss people's desire for freedom suggested a common ground. The banks, which would not care about the small saver, functioned as enemy images. Among the members of the European Kings Club were then also in particular small investors, who felt confirmed by the community feeling and the ideology of the club.

The founder of the European Kings Club was Damara Bertges, who made common cause with the German physician Hans Günther Spachtholz. Neither Bertges nor Spachtholz had the appropriate training or investment experience, which is why the ertrogenic assets were squandered, entrusted to dubious persons and invested in loss-making businesses. Spachthold made a confession and was sentenced to four and a half years in prison. Bertges refused to cooperate with the judiciary, was extradited to Germany and was finally sentenced to eight years in prison for fraud.

Until the very end, supporters of the European Kings Club protested outside the prison where Bertges was imprisoned, blaming the judiciary for the collapse of the club. Despite the obvious fraud, many members continued to stand by Bertges and the club survived.