A lawyer allegedly implicated in a scheme to evade €428 million ($477 million) in taxes in Germany is set to face criminal trial in November, the latest case in the country’s “cum-ex” finance scandal.
The “cum-ex” scandal involved the aggressive manipulation of an apparent loophole in German tax law that allowed participants to claim refunds on taxes they’d never paid.
Cum-ex transactions involved investors swapping shares back and forth with (“cum”) and without (“ex”) dividend entitlement around the date when dividends are paid.
The apparent loophole was later closed and German courts eventually ruled that the scheme amounted to criminal tax avoidance.
Total tax losses from “cum-ex” schemes are estimated to have cost the government tens of billions of euros in lost revenue.
Prosecutors in Cologne allege that the lawyer was “one of the central players in the cum/ex market with German shares” and said he oversaw numerous transactions with an alleged accomplice who has already been criminally convicted as part of the scandal.
According to the indictment, the defendant, as an expert in investment law, is alleged to have been involved in particular with the establishment of complex fund structures.
He is accused of particularly serious tax evasion in eight cases in the years 2007 to 2015, according to an announcement from the regional court in Bonn, which will handle the case.
The criminal charges were brought against the man more than two years ago, and the trial is expected to last into 2025.
