Philipp Amthor’s World: A Young Star in Angela Merkel’s Party Is in Danger of Falling
From that point on, Augustus boasted to investors about its excellent contacts in Berlin. Wolfgang Haupt wrote to a German business leader: “We have support and inquiries from Economy Minister Altmaier and Digital Infrastructure Minister Scheuer to quickly push into the German market and take part in Altmaier’s ‘AI Airbus.'” The reference was to an idea of Altmaier’s to initiate a Franco-German project modelled on the cross-border consortium behind the airplane manufacturer. But Haupt had apparently promised too much. The Economy Ministry stated that Augustus “was not involved on issues of artificial intelligence.”
But the meetings in Berlin were likely extremely helpful early on. Several large investors joined Augustus. Kevin Washington, the son of one of the richest families in the U.S., pledged to make $50 million available, making him a “lead investor.” August François von Finck, part of the German business dynasty, injected $11.2 million. A company partly owned by the Fincks, the Swiss auditing firm SGS, was, according to Augustus, one of the startup’s first clients.
And the well-known former German politician Karl-Theodor zu Guttenberg also got involved. On Jan. 5, 2019, Wolfgang Haupt sent an email to the former German defense minister. He had been forced to step down from his cabinet position in March 2011 after it was revealed that he had plagiarized significant portions of his Ph.D. thesis and he then moved to the U.S., where he has worked since then as a tech consultant and investor. Guttenberg embodies all the qualities that Augustus needs: He has money, he is well known, and he has ties to powerful people.
Guttenberg and Haupt had apparently already met before in the swanky Swiss ski resort of Klosters. Haupt, in any case, addressed his email to “dear KT” and provided him with all kinds of documentation pertaining to Augustus. In addition to data centers, he wrote, the company also intends to provide “language recognition and object recognition” services. “I’m looking forward to your input and further discussion,” Haupt wrote.
A short time later, Guttenberg joined Augustus, initially as an investor. Later, “KT” would be named president and given a seat on the Board of Directors – along with Philipp Amthor.
It seems rather ironic that the paths of these two men would cross at Augustus. The one, Amthor, had his sights set on rising to the very top of the political world. The other, Guttenberg, had already been there before suffering a dramatic fall.
A “Fantastic Network”
At first glance, the two have little in common. Amthor has had to fight his way to where he now is while Guttenberg was born into high society. Nevertheless, they are said to get along well, according to sources in Berlin, who add that the former defense minister is something of a mentor to Amthor.
Under a different set of circumstances, the two of them could have ended up in the same governing cabinet together. Instead, they began cooperating as part of a New York-based startup. The capital they brought to the table: Political contacts.
Guttenberg, for example, told former British Foreign Minister David Miliband about Augustus, writing in a chat that Miliband was a “long-time friend” of his and would like to get involved in Augustus. His British friend, Guttenberg wrote, “has no clue about tech, but he has a fantastic network.” And that was the point.
Amthor was named to the board of directors in May 2019. According to chats, he flew to New York around that time, spending time with people from Augustus. He also received a company email address, followed a short time later by Augustus business cards.
Amthor showed dedication. “Let’s talk regularly on the phone so that I can participate a bit more deeply in product development,” he wrote to a company employee. It is a request that doesn’t seem to jibe with his earlier claim to DER SPIEGEL that his connection with Augustus “is not tied to the regular performance of tasks.”
Amthor receives no salary for his services, according to an Augustus statement from March. He did, however, receive stock options – at least 2,817 of them, according to an internal overview. The options enabled Amthor to buy shares in Augustus at a fixed price. It’s not difficult to see the conflict of interest here: If Amthor’s promotional efforts on behalf of Augustus are successful and he manages to generate more business for the company, its value rises. Were Amthor to then exercise his stock options and go on to sell them, he could earn a tidy sum.
When contacted by DER SPIEGEL in March about this potential conflict of interest, Amthor defended himself by pointing out that he had reported his participation in the board of directors and the stock options to the Bundestag administration in May 2019. And his position as director is listed in his profile on the parliamentary website, bundestag.de. But the stock options are not. Amthor said that the Bundestag administration had confirmed to him that the stock options were not considered a pecuniary advantage according to rules pertaining to the behavior of members of parliament and were thus not publicized on the Bundestag website.
A Reward for Lobbying?
It is something of a loophole in the rules. Whereas members of parliament who earn money elsewhere must publicize that income over and above a certain limit on the Bundestag website, ownership of stock options remains undisclosed. As a result, the public learned nothing about Amthor’s holdings, despite suspicions that the options were a reward for his lobbying efforts.
Whether Amthor’s enthusiastic support for Augustus was legal is difficult to say. According to laws pertaining to the activities of lawmakers, parliamentarians are not allowed to accept monetary payments that are only made with the expectation that the payer’s interests will be represented in German parliament. He may have violated that provision.
Why did Philipp Amthor get involved with Augustus? There is much to indicate that he was attracted to the company due to the elites with whom it had surrounded itself. Plus, the praise he had been receiving as the party’s young up-and-comer made him feel as though he belonged.
Amthor has managed to work his way quite a few rungs up the ladder within just a few years, despite starting from relatively modest beginnings. He grew up in the town of Torgelow in Mecklenburg-Western Pomerania and his mother made a living as a coach to call center workers. He doesn’t speak publicly about his father.
He joined the CDU’s youth wing at 15. Once he completed high school, he intended to study law in Hamburg, but ultimately chose to stick closer to home and matriculated in the University of Greifswald just up the road. He says that he did so on the advice of Angela Merkel. “She told me that it is best to engage in politics from home,” he says. The chancellor’s own voting district is in the state of Mecklenburg-Western Pomerania. Amthor obtained her telephone number early on – at least he is fond of telling confidants as much.
With deftness and a bit of callousness, Amthor managed to shunt aside the incumbent parliamentarian in his voting district ahead of 2017 federal elections, won the vote and became one of the youngest parliamentarians in the Bundestag.
Once he arrived in Berlin, Amthor quickly became a focus of attention, partly because of his appearance. Even in the center-right CDU, jeans, trainers and a scruffy beard had become common, but Amthor preferred dark suits and carefully parted hair. But it was a speech on the plenary floor in February 2018 that brought him wider attention, during which he lambasted the right-wing populist Alternative for Germany. The video has been viewed more than 1.5 million times on YouTube, a reach that is no doubt a function of Amthor’s proficiency as a speaker and the rather amusing facial expressions he can conjure up on his boyish face.
A More Relaxed Atmosphere
After just a few months, he made his first appearance on the widely viewed political talk show “Maischberger.” He was a perfect fit for Augustus: young, digitally fluent and hungry for success. “Google him and his performance in the last talk shows :)” wrote CEO Haupt in a mail to colleagues.
In July 2019, Amthor flew with Haupt to the meeting on Corsica with Charles-Edouard Bouée to discuss his possible involvement. “Philipp and I are now with him,” Haupt informed colleagues. Bouée unexpectedly resigned from his leadership position at Roland Berger not long before. The German business publication manager magazin reported that Bouée had fallen into disfavor for undisclosed services he had allegedly provided to a fund, but Roland Berger has denied that account.
As one does in the business world, Amthor, Haupt and Bouée apparently shunned a sterile conference room in favor of a more relaxed atmosphere where they could better get to know each other away from the spreadsheets and business plans. Photos and videos they sent indicated that the three had quite a good time. The sun, the sea; there were even dolphins to admire.
How much did the trip end up costing? And who paid Amthor’s expenses?
Amthor is the kind of parliamentarian who constantly keeps his constituents up to date about his activities via Facebook and Instagram. They are told when he gives interviews to the press or holds speeches on the plenary floor. But he chose not to discuss on social media channels the several days he spent on the Mediterranean as an Augustus director. His followers on Facebook and Instagram also learned nothing of the follow-up meeting. This time, they headed for the Alpine resort town of St. Moritz, as chats and photos reveal. Amthor apparently stayed in the five-star hotel Suvretta House, with a photo showing him together with Haupt, Roland Berger and Hans-Georg Maassen in the hotel lobby. In summer 2019, Maassen became a controversial figure within the CDU, with party chair Annegret Kramp-Karrenbauer hinting at the possibility of throwing him out of the CDU. He had become involved in an ultra-conservative splinter group, but Amthor was among those who had defended him, including on the plenary floor in the Bundestag.
Just a few weeks prior to the St. Moritz meeting, Haupt had reserved a private jet for himself, Maassen and other acquaintances. Files indicate that they flew in a Gulf Stream from Berlin-Schönefeld to Newark.
Maassen apparently had an opportunity to show his gratitude for the trip a short time later. When an Augustus employee in Germany had questions about German citizenship, “hg,” as he signs his emails, made a call to the German Interior Ministry and spoke to the official in charge of such issues. Maassen wrote that the official would get back to him. A ministry spokesperson confirmed that Maassen had contacted the ministry “with a legal inquiry” and that it had pertained to the “regaining of citizenship for an acquaintance.” The query, the spokesperson said, had been answered by the relevant official.
The Swankiest Hotspots
August Hanning, the former head of the BND, Germany’s foreign intelligence agency, also bestowed a visit on Augustus, as he has confirmed. Artificial intelligence, of course, is a significant focus of the security industry, with software for object recognition or facial recognition highly sought after by police and intelligence agents. According to the invitation list, Amthor was present at that meeting too.
It must have all been quite exciting for the young parliamentarian. He now belonged. He was invited to meetings with investors and made another trip to New York in October 2019, though the precise purpose of the trip remains unclear. Photos, though, show that there was a bit of time for fun. Haupt and Amthor spent one evening in the hip Hotel Baccarat on 53rd Street. Friends and colleagues joined them there for oysters and champagne from the Ruinart Blanc de Blancs label. Suddenly, it seems, Amthor, the boy from Torgelow, had become a patron of New York’s swankiest hotspots.
But such parties were not sufficient to divert attention from the fact that problems were mounting at Augustus. The introduction of a product had been delayed, a situation that was criticized inside the company. Furthermore, significant investments that had been announced with much fanfare still hadn’t shown up, such as the $50 million that primary investor Kevin Washington had pledged.
During this period, the face of Augustus changed. A number of techies still worked for the company, but Haupt, Guttenberg and Bouée were becoming increasingly influential. The atmosphere had grown rawer. On at least one occasion, Amthor was informed of a dubious incident, as an August 2019 email indicates.
The focus was a German business partner of Augustus named Marco Streng, also a “wunderkind” according to business publications. Streng’s company Genesis Mining earned its money through cryptocurrencies and operated data centers around the world for that purpose. Streng, though, was apparently having trouble with technical equipment worth $300 million in China.
Augustus wanted to help. Bouée would “need a bit of cash to open the necessary doors in China,” Haupt wrote to Guttenberg in August 2019. Philipp Amthor was cc’d in the mail. “We should earmark 1 to 5 million for the purpose,” the email read. Was Bouée preparing to pay bribes in China to solve Streng’s problem? If so, what did Amthor have to say about the idea? He said himself in March that his position as director was “sort of like the function of a supervisory board member in a German corporation.” When supervisory boards sanction bribery, they can be punished by law in the U.S.
A Favor
In return for their help, Augustus had a favor to ask of Streng. Augustus was interested in taking over an area of operations from Genesis, though only for three years and without laying claim to significant profit. The deal was apparently aimed at making it look from the outside as though Augustus was growing. Haupt wrote that the deal was advantageous because it would translate to “greater revenues.” He wrote that the goal was “50Mio to 100Mio per year … but if it turns out to be 30Mio, that’s also OK initially.”
The files in DER SPIEGEL’s possession do not reveal whether the questionable deal ever actually came to fruition. But the email substantiates the accusations that two former employees have leveled at the company in recent months. Augustus fired them for stealing intellectual property and filed charges. They deny the accusation and have responded with a countersuit. Even when they were hired, they say, they were misled about the condition of Augustus, as were investors.
In March, Augustus denied the accusations made by the former employees. “We have revenues and clients on both sides of the Atlantic,” the company said at the time. Furthermore, the statement continued, the company had secured two patents. As such, the company is able to develop products, the statement read.
Back then, the lobbying activities of Amthor on behalf of Augustus were not a focus. Following the publication of the initial DER SPIEGEL story about the company, however, local reporters asked the lawmaker about his connection to Augustus. Amthor told the local newspaper Ostsee Zeitung: “Political offices are always temporary and that is why many citizens correctly expect that their representatives not be lifelong politicians.” He said he found it “beneficial and enriching” that his legal expertise could be applied to an innovative sector like artificial intelligence.
Still, it is difficult to square Amthor’s image as a down-to-earth parliamentarian from a rural district with his flamboyant life as the director of a startup. Around a year ago, DER SPIEGEL tagged along with the young lawmaker during a trip to his district. Back then, Amthor said: “It is important to be close to the people. Then, you don’t lose your way.”
Icon: Der Spiegel