Wednesday, December 15, 2021
Suspected cum-ex deals
Investigators search SEB bank in Frankfurt
The German judiciary is still concerned with the scandal of fraudulent cum-ex deals. Investigators are now conducting a raid on the Frankfurt headquarters of the major Swedish bank SEB. The tax authorities apparently demand taxes amounting to several hundred million euros.
Investigators searched the German headquarters of the major Swedish bank SEB in Frankfurt in the cum-ex share dealings. The money house confirmed the raid and said they were cooperating with the authorities. The Cologne public prosecutor had previously confirmed that there was a raid on the financial center. In the search with more than 80 investigators, which has been running since Tuesday, the workplaces of the accused and apartments are in focus. The authority did not give the name of the bank. The background is therefore a tax demand from the tax authorities in the amount of 425 million euros plus interest.
The SEB further stated that it was about business of the subsidiary DSK Hyp. The bank had “to the best of its knowledge” not offered or carried out any transactions in Germany aimed at recovering taxes that were not paid, it said in a statement. “We distance ourselves from this type of agreement.”
“The measures are related to the bank’s cum / ex transactions, which are the subject of the proceedings, and are directed against former employees and other responsible parties,” said a spokesman for the Cologne public prosecutor’s office. The aim is in particular to find relevant communication in the form of e-mails and other written correspondence. In addition to representatives of the Cologne public prosecutor’s office, investigators from the Essen criminal police, officials from other police stations, the Frankfurt tax investigation department and the Federal Central Tax Office were also involved in the search.
The “Cum-Ex” deals are one of the biggest tax scandals in German post-war history. Investors used a loophole in the law to cheat the German state out of money for years. Around the dividend cut-off date, several participants pushed back and forth shares with (“cum”) and without (“ex”) dividend entitlements. As a result, tax authorities reimbursed capital gains taxes that had not been paid. The state suffered billions in damage.
In 2012 the tax loophole was closed. Several public prosecutors and courts nationwide have been investigating for years. In July, the Federal Court of Justice ruled in a landmark ruling that cum-ex deals are to be assessed as tax evasion and are therefore punishable.