- Frankfurt court opens tax-evasion trial against seven bankers
- Defense lawyers claim judges are biased and should be removed
A Deutsche Bank AG official and six former colleagues went on trial in Frankfurt on Monday charged with being part of a group that tricked authorities about value-added tax refunds on carbon-emissions trading in 2009 and 2010.
The case is part of the biggest crackdown on emissions-related tax crimes since the European Union began its cap-and-trade system in 2005 and saw police raid Deutsche Bank in 2012. Six men who ran companies that traded emission certificates with Deutsche Bank were found guilty in December 2011 of evading 260 million euros ($291 million).
Defense lawyers began the trial by demanding to have the three professional judges at the bench removed for bias. They argued the same judges already convicted the men in the related 2011 trial for allegedly working with the accused in today’s case, so they can’t pretend they will hear the facts neutrally.
The presiding judge Martin Bach has already indicated that he thinks the bank knew what was going in and didn’t stop the scheme, the lawyers argued.
He “gave an interview in public TV in 2013 in a program with the sensational title ’Sinister dealings -- the scandals of Deutsche Bank’," said Wolfgang Koeberer, one of the defense lawyers. "The viewers could only understand his statements as showing that the judge was already convinced of the defendants’ guilt."
The trial comes as Deutsche Bank seeks to reassure investors who dumped European bank bonds and shares last week amid concerns over declining earnings and slowing global growth.
Germany’s biggest bank has paid more than $9.3 billion in fines and legal settlements worldwide since the start of 2008, according to data compiled by Bloomberg. That includes settlements related to violations of U.S. sanctions, rigging of interest-rate benchmarks and allegations that it defrauded mortgage issuers Fannie Mae and Freddie Mac.
The company stopped trading emission certificates in 2010, repaid the taxes and is cooperating with the authorities, said Frank Hartmann, a spokesman for the Frankfurt-based lender. Only one of today’s seven accused is still at the bank, he said.
The bank paid back 220 million euros of tax refunds that were uncovered during the investigation. Prosecutors said last year they’re still investigating 15 people who worked or are still working for the bank. In addition, three bankers have settled. Co-Chief Executive Officer Juergen Fitschen and former management board member Stefan Krause are also being investigated as part of the carbon probe. Both have denied wrongdoing.