ROUNDUP 2: Cum-Ex Key Character Delivers – ‘Tip of the Iceberg’

(new: Swiss Federal Office of Justice in the 7th paragraph)

DÜSSELDORF (dpa-AFX) – One of the key figures in the scandal surrounding illegal cum-ex stock transactions is being handed over to the German judiciary. The Swiss Federal Office of Justice has approved the extradition of tax lawyer Hanno Berger, said a spokeswoman for the North Rhine-Westphalian Ministry of Justice on Tuesday in Düsseldorf. There are no more appeals against the decision.

While Berger and more than 1,300 suspects are being investigated in the Cum-Ex scandal, an even bigger fraud scandal is obviously looming. According to NRW Minister of Justice Peter Biesenbach, the Cum-Ex fraud is probably just the “tip of the iceberg” despite its estimated double-digit billion volume. There are “strong suspicions” about this, the CDU politician told the “Frankfurter Allgemeine Zeitung”.

The Cum-Ex investigators in Cologne had come across other methods of suspected tax fraud, confirmed a ministry spokeswoman for the German Press Agency. “In order not to jeopardize the investigations, we cannot outline these models at this time.”

NRW Minister Biesenbach told the newspaper: “Anyone who thinks they can plunder the state must expect the state to accept the challenge. We want the money.” There will be further publicly effective actions in the near future. He assumes that the number of investigations will increase significantly this year.

In the Hanno Berger case, both the Hessian and the North Rhine-Westphalian judiciary had applied for the extradition of the German lawyer. Both requests have now been granted, the spokeswoman said. A quick transfer of the accused is expected. This brings a process closer to Berger in Germany. Berger should have appeared in an ongoing cum-ex trial at the Wiesbaden district court last spring, but stayed away. Therefore, the case against him was severed.

“The now approved extradition of an accused lawyer in a cum-ex trial before the Wiesbaden district court proves the strength of the rule of law,” said Hesse’s Justice Minister Eva Kühne-Hörmann. The great perseverance of the authorities involved is now bearing fruit, “so that the basis has been laid for a Hessian court to be able to administer justice in this important matter”.

Upon request, the Swiss Federal Office of Justice announced that it had already approved the extradition on August 20, 2021. “Now that the Federal Supreme Court has not acted on the complaint of the person concerned in the last instance, the decree of August 20, 2021 has become final and can be executed.” For security reasons, however, the Federal Office does not provide any further information before an extradition is carried out. Berger was arrested in July 2021 in the canton of Graubünden and is in extradition custody.

Berger, a former tax official, is believed to be one of the architects of the model in which banks and investors never had taxes refunded. He last lived in Switzerland and had rejected the allegations.

He and his lawyer argue, among other things, that the offenses he was accused of were not punishable in Switzerland. The Swiss Federal Criminal Court contradicted this: “It obviously cannot be right that a withheld tax is paid out twice,” the court argued. The procedure can be described as fraudulent.

In cum-ex deals, banks and other financial players pushed stocks with (“cum”) and non-dividend (“ex”) dividend rights back and forth around the dividend record date. The aim of the confusion was the refund of taxes that had not been paid. According to estimates, the German state lost an amount in the double-digit billions as a result. Cum-Ex peaked between 2006 and 2012. Several courts and public prosecutors have been working on the scandal for years./fc/oe/als/DP/jha