Tax authorities mount raids on 19 German banks and houses
Investigation is linked to Panama Papers and part of money laundering allegations
Eleven banks and eight private homes and offices across Germany have been raided by police and tax investigators as part of a wide-ranging investigation into tax evasion.
The raids, which began at dawn on Wednesday and went on into the afternoon, were part of the same investigation started last November over money laundering allegations linked to the so-called Panama Papers scandal, alleged to involve Deutsche Bank.
The eight individuals under investigation are alleged to have founded companies in offshore tax havens aided by a former British Virgin Islands branch of Deutsche Bank.
“With the help of a former subsidiary of a major German bank, they are each believed to have founded companies in tax havens on the British Virgin Islands to hide capital gains from the German tax authorities and evade tax that was due on them,” Frankfurt state prosecutors said in a statement.
Among the properties searched were the offices of tax advisers and asset management companies, in Munich, Hamburg, Bad Tölz, Bonn, Düsseldorf, Frankfurt, Aachen, Cologne and Sylt, an island off the North Sea coast.
Deutsche Bank issued a statement on Wednesday stressing that the investigations are aimed at private individuals and not the bank itself. Its offices had not been searched, it said, adding that the bank was offering its assistance to investigators and voluntarily handing over documents requested of it.
The last major raid linked to a case, which has shaken investors and regulators in Germany, took place on 29 and 30 November 2018, and involved more than 170 officers who searched the headquarters of Deutsche Bank and other offices.
A fourth quarter loss suffered by the bank earlier this year was put down by bosses in part to the negative publicity surrounding the raids.
The bank continued to deny any wrong-doing on Wednesday.
The small British Virgin Islands branch of the bank was part of its Global Trust Solutions business, which was later sold by Deutsche Bank to NT Butterfield & Son, a lender based in Bermuda.
Deutsche Bank said in a statement: “The investigations are not directed at Deutsche Bank. The state prosecutor is investigating private persons. Deutsche Bank is cooperating with the prosecutors and is voluntarily handing over all the documents requested of it. A search of the bank’s offices has therefore not taken place.”
In 2016 in the Panama Papers exposé, an international media network, including the Guardian, revealed flows of money going from an array of politicians, business people and celebrities to the central American tax haven of Panama where thousands of offshore companies are registered. The scandal put a large number of individuals and businesses under pressure to explain themselves.