'Stasi Methods': McDonald's Germany Accused of 'Harassment and Pure Manipulation'

By John Goetz, Andreas Wassermann and

An informant to the former East German secret police held a management position at McDonald's for years. The man with Stasi ties is believed to have spied on a restaurant operator. Were managers at the fast-food chain looking for ways to terminate contracts with franchisees without having to pay them?

Photo Gallery: McDonald's Germany's Stasi Controversy Photos
DDP

There's a hint of the smell of deep-frying fat in front of the McDonald's restaurants, even though such odors are not supposed to be detectable. "It's the filters," says Ulrich Enzinger, "it's time to change them again." The odor isn't very strong, but 49-year-old Enzinger has a keen sense of smell, honed by 18 years of experience at McDonald's.

One of his restaurants was in Lindau, a town on Lake Constance in southwestern Germany, in a prime location adjacent to the on-ramp for the autobahn to Munich. Unnerved, he gave up the business a year ago.

The restaurant is busy on this Monday morning, as Enzinger parks his car in one of the few empty spaces, locks the door and walks toward the entrance. Suddenly a dark sedan pulls up next to him, the passenger window opens and a voice says: "You are barred from the premises. Please leave."

The incident is reported to McDonald's German headquarters in Munich on the same day. More trouble with the franchisees -- a common problem for executives at McDonald's Germany these days.

Many of the company's franchise operators are at odds with management. They feel that they are being spied on and put under pressure or, as Munich attorney Horst Becker puts it, "systematically forced out." In the last few years, Becker alone has represented two dozen McDonald's franchisees.

A Market Shakeout

The list of accusations is long and includes manipulation during restaurant inspections, harassment and targeted spying. The company even hired detectives to spy on a Frankfurt franchisee it didn't like, and one case is even under investigation by the public prosecutor's office in Munich. With a network of McDonald's restaurants in German that has grown even denser than that in the United States, the company is emphasizing efficiency these days rather than growth.

Attorney Becker speculates that McDonald's hopes to get rid of franchisees -- its independent business partners who pay a fee to operate one or more restaurants -- as cheaply as possible. The goal, at least according to company documents, is to reorganize the market so that fewer franchisees operate a greater number of restaurants.

But it isn't quite that easy. The franchise agreements are concluded for the long term, generally with 20-year contracts, and in many cases the restaurant operators have invested millions, making buyouts potentially very expensive. It's cheaper for the company to find ways to terminate its existing agreements.

Help from a Former Stasi Informant

Enzinger learned this the hard way. In 2005, he met Bernd R., the man in charge of the McDonald's market in southern Germany. R. had some unusual experiences under his belt. As a cook in the National People's Army of communist East Germany in 1980, he spied on fellow soldiers who had been stealing preserved fruit from the regiment inventories. Officials at the Ministry for State Security (Stasi), East Germany's secret police, were so impressed by the soldier that they recruited him as an informer. His code word for establishing contact with the Stasi was "Gulaschkanone," German for field kitchen). "Intellectually speaking," his managing officer commented, R. was qualified to "complete operational tasks."

"Roland," as he was also known, then started his career -- first as an employee in the central council of the Free German Youth (FDJ), East Germany's official youth organization, and later as a restaurant manager for one of the main organs of the East German regime. He had plenty to report during the latter assignment. "The candidate said, without hesitation, that he intended to continue supporting the MfS (Ministry of State Security)," one Stasi report stated. From then on, "Roland" reported internal information from the waiters working in the government restaurant. He met with his managing officer for the last time on Nov. 23, 1989, two weeks after the opening of the Berlin Wall.

R. admits that he worked for the Stasi, but he insists that he did it because he was "put under pressure by supervisors and employees" at the secret police. He also claims that he reported "nothing but banalities" to his managing officer. McDonald's had also been made aware of R.'s past as an informer after it received an anonymous letter. According to a McDonald's spokesman, the company then gained access to the official files, with R.'s permission, and had attorneys review them. They apparently concluded that his Stasi past didn't pose a problem.

It appears that R. attended to associates who had fallen out of favor at company headquarters in Germany. One of them was Ulrich Enzinger, who was operating five restaurants at the time. Business was booming, and he was sending millions in franchise fees to the Munich offices every year. Nevertheless, he was apparently a thorn in the side of the McDonald's family of restaurants.

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