Jailed K1 founder has diplomatic status - lawyers

FRANKFURT, Nov 9 (Reuters) - The founder of Germany's K1 hedge fund group has denied he committed fraud, wants to be released from jail on bail and is claiming diplomatic immunity, documents appealing against his arrest showed.

Lawyers seeking the release of Helmut Kiener, whom prosectors say is suspected of fraud and breach of trust, said he has diplomatic status from the West African nation of Guinea-Bissau.

His arrest warrant said Barclays (BARC.L) and BNP Paribas (BNPP.PA) may have lost millions of dollars in the case, which prosecutors say spanned the Atlantic and featured lavish personal spending on planes, a helicopter and luxury properties. [ID:nLT702092]

In a filing to a court in Wuerzburg dated Nov. 5, his lawyers say it was inappropriate to accuse Kiener of fraud or breach of trust.

"Mr Kiener is of the view that funds were invested, objects were rented out or chartered, and that the funds are still there," the appeal of his arrest showed.

Some of the accusations were based on "misunderstandings", not facts, the filing said.

Kiener's lawyers said there was no danger of him fleeing the country since the centre of his life remained his home town of Aschaffenburg, where he lives with his wife and children.

They asked the court to release him on 500,000 euros ($748,700) in bail.

Prosecutors were not immediately available while the embassy of Guinea-Bissau in Brussels had no immediate comment.

(Reporting by Alexander Huebner and Eva Kuehnen; writing by Edward Taylor)