Tax controversy erupts. - A mere 1% of cum-ex prosecuted individuals have been brought to justice.
Cologne prosecutors have been working on uncovering Cum-Ex, the largest tax fraud in Germany's history, for twelve years now. With over 30 prosecutors immersed in the case, they have only succeeded in charging one percent of the accused - 17 out of 1700.
While some of the initial rulings, such as the case against tax lawyer Hanno Berger, who is thought to have invented the scheme, have been legally binding, the majority of the cases are still ongoing. There's a concern that some cases might expire and with them, the potential for recovering billions of dollars in repayments to the government.
The financial damage in Cum-Ex transactions can be estimated to be a staggering ten billion euros. In these transactions, investors exchanged stocks with dividend and without dividend rights, causing the financial authorities to inadvertently pay capital gains tax that had not been paid.
The Cologne prosecutor's office has managed to interrupt proceedings in 120 investigation complexes, but there's no immediate danger of expiration, as they have not yet reviewed all the evidence. That's according to a spokesperson from the office, who spoke to dpa. However, they also admit that not all investigated evidence has been assessed yet, and unknown criminal activities could still be lurking in it. Interrogations of the accused could reveal more suspects as well.
As for the accused, time is running out. There are cases where criminal acts could not be prosecuted because the prosecutors became aware of them too late. However, there is still the option of seizing their assets.
For Cum-Ex offenses, the statute of limitations has been extended to 15 years due to the magnitude of the damage. Nonetheless, this regulation doesn't apply to cases that had already expired by the end of 2020.
A controversy over the leadership of Anne Brorhilker, the Cum-Ex chief prosecutor, surfaced when she unexpectedly resigned and joined the organization Finanzwende in April. Her departure was sparked by a decision by the NRW Justice Minister, Benjamin Limbach, to split the department she led. This prompted Limbach to reassess the Cologne prosecution department, leading to the creation of four group leader positions and four additional roles.
The FDP faction in the NRW state parliament launched a major request featuring 331 individual questions to gain more insight into the situation. The response from Limbach after taking office reveals what shocked him and the reason behind his decision to enlarge the "bottleneck" at the head of the main department H.
Despite being a divisive figure, Brorhilker had been handling an incredibly heavy workload. The arrival of a detention request would have been disastrous without her present. Furthermore, there were issues with the Hamburg Investigative Committee and outdated reports.
Limbach denies allegations that he did not seek Brorhilker's input before proceeding with his decision. He argues that legally, this wasn't necessary given the manner in which main departments were established. Still, critics like Werner Pfeil, the legal political spokesperson for the FDP in the NRW state parliament, argue that Limbach disrupted the whole system with his division of the department.
Tim Engel, Brorhilker's successor, is now tasked with sorting out the situation. Could this mean an increased case load soon? The construction of a new court building in Siegburg, near Cologne, specifically for Cum-Ex proceedings might hint at it. This building is scheduled to be finished in October, where economic criminal proceedings will be heard for the next 15 years.
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Benjamin Limbach, the NRW Justice Minister, made a significant decision concerning the Cologne prosecution department, leading to the creation of additional roles and splitting the department led by Anne Brorhilker, the Cum-Ex chief prosecutor.
Anne Brorhilker's departure from the Cologne prosecutor's office, sparked by Limbach's decision, was a surprise as she had been handling an incredibly heavy workload in the tax scandal investigation related to Cum-Ex.
Despite her departure, the financial damage from Cum-Ex transactions, estimated at ten billion euros, remains a major concern in North Rhine-Westphalia, with investigations ongoing in numerous complexes.
Hanno Berger, thought to have invented the Cum-Ex scheme, faced legal rulings as part of the investigations, while the majority of cases stemming from the tax scandal remain unresolved.
Following Brorhilker's departure, Tim Engel was appointed her successor to handle the numerous investigations and cases relating to Cum-Ex in Cologne, with a new court building scheduled to be completed in October to facilitate economic criminal proceedings.
