Bernie Ecclestone was a conspirator in a bribery scheme that allegedly sent $44 million to a Bayerische Landesbank executive in exchange for the 2005 sale of the lender’s stake in Formula One racing, prosecutors claimed.
Formula One Chief Executive Officer Ecclestone “hasn’t been blackmailed, he is a co-perpetrator in a bribery case,” public prosecutor Christoph Rodler said in closing arguments today at the Munich trial of former BayernLB Chief Risk Officer Gerhard Gribkowsky. The two men agreed they “would support a sale of BayernLB’s Formula One stake to Ecclestone’s benefit.”
Ecclestone, 81, who hasn’t been charged with a crime, is planning an initial public offering for Formula One in Singapore where shareholders intend to raise as much as $3 billion. Gribkowsky, who was sentenced today to 8 years and six months in prison for accepting bribes, breach of trust and tax evasion, told the court last week that Ecclestone bribed him during the sale of the lender’s stake in the racing company to CVC Capital Partners Ltd.
“The defendant has set a lot of things right for BayernLB, including the negotiations with Ecclestone, the secret owner of Formula One,” Presiding Judge Peter Noll said. “There were numerous leads indicating that there was an accord between Mr. Ecclestone and the defendant and Ecclestone couldn’t explain why he paid him such a high amount.”
‘In Most Parts’
Gribkowsky told the court his indictment was “in most parts” correct. In exchange for his confession, the judges had informally agreed Gribkowsky would get a prison term ranging from 7 years and 10 months to 9 years. Rodler today asked for a sentence of 10 years and six months.
“Gribkowsky’s confession came at a late stage on day 45 of the trial, but at least it was made,” Rodler said. “Ecclestone doesn’t give away money, he generates it; that’s why bribery remains as the only explanation.”
Ecclestone said June 21 he doesn’t expect to be charged and that he wasn’t concerned the case would disrupt Formula One’s planned IPO in Singapore.
Ecclestone, who is being investigated by Munich prosecutors over the issue, told the court last year he was caught up in a sophisticated shakedown and paid Gribkowsky because he feared the banker might tell U.K. tax authorities about a family trust controlled by his then-wife.
Steer the Sale
Prosecutors said Gribkowsky, who managed Munich-based BayernLB’s interest in Formula One, received $44 million to steer the sale of the bank’s 47 percent stake in the racing circuit to CVC, a U.K.-based buyout firm, and also agreed to a sham contract under which Ecclestone allegedly received a kickback. Until last week, Gribkowsky denied the claims.
“Ecclestone has been caressing Gribkowsky with his charm and sweet-talked him with a future career in Formula One,” Gribkowsky’s lawyer, Dirk Petri, told the court. “He turned Gribkowsky into his errand boy and servant of two masters, namely BayernLB and Ecclestone.”
BayernLB acquired the Formula One stake after the 2002 bankruptcy of Leo Kirch’s media group. Gribkowsky clashed with Ecclestone and sued him in London over corporate-governance rules changed to limit the lender’s influence. Ecclestone wanted to push BayernLB out and saw a chance when CVC showed interest, prosecutors said.