A legal trial in opposition to one of many key figures in Germany’s sprawling “cum-ex” tax scandal started on Thursday earlier than a courtroom within the western German metropolis of Bonn.
The German lawyer Kai-Uwe Steck is accused of eight instances of significantly severe tax evasion between the years of 2007 to 2015, which allegedly resulted in tax losses for the German authorities totalling €428 million ($450 million).
Steck was a regulation associate of the lawyer Hanno Berger, who has been considered the driving pressure behind the unlawful cum-ex transactions in Germany. Berger has beforehand been convicted for his position within the scandal and is at the moment serving his sentence in jail.
Steck, 53, performed a central position within the prosecution of figures concerned within the “cum-ex” scheme. He confessed to his position in 2016 and have become a key witness in a number of trials.
If he’s convicted, his position as a key witness is more likely to mitigate the sentence.
Within the fraud scheme, monetary traders shifted inventory shares forwards and backwards round dividend funds dates with the intention to aggressively exploit an obvious loophole in tax regulation.
Germany was significantly badly hit by the scandal, though different international locations had been additionally impacted by the scheme.
By swapping shares with (“cum”) and with out (“ex”) dividend entitlements forwards and backwards, gamers within the scheme had been capable of obtain tax refunds from the German authorities – regardless of having by no means paid the taxes within the first place.
Estimates have positioned total losses to the German authorities from the scheme within the tens of billions of euros.
The scheme peaked in reputation between the years 2006 to 2011. Revelations of the aggressive use of the “cum-ex” scheme by rich traders outraged the German public and induced a significant scandal.
