• The Financial District

GERMAN PROSECUTORS SEARCH LOBBY GROUP FOR EVIDENCE IN TAX FRAUD

Public prosecutors on Tuesday raided the Berlin and Frankfurt offices of German bank lobby group BdB as part of its crackdown on a scam involving multi-billion-euro trades to get bogus tax reclaims, Patricia Uhlig and Matthias Inverardi reported for Reuters late on August 4, 2020.

BdB and the public prosecutor’s Cologne office said that the investigations are not directed against officials of the lobby group.


“The purpose of the search is to find evidence that may be relevant to the continuation of the investigation and the further clarification of the complex facts,” the prosecutors’ office said.


The investigators suspect that defendants in several criminal proceedings tried to influence lawmaking to keep loopholes opens for the sham trades, using BdB’s influence in Berlin, the daily Sueddeutsche Zeitung reported. These so called “cum-ex” trades thrived between 2005 and 2012 and allowed investors around the world to target chiefly German companies to generate multiple tax reclaims from phantom dividends, costing the taxpayers more than 10 billion euros until loopholes were closed.


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