Maple Bank's Ex-Bigwigs Face Heat Over Fraudulent Cum-Ex Stock Deals
Former Bank Workers Accused of Participating in Cum-Ex Share Schemes - Former Bank Employees Accused of Cum-Ex Dividend Arbitrage Scams
Get ready for some thrilling court dramas, folks! The Frankfurt prosecution is on a roll with their investigation into the Cum-Ex stock deals that left the public treasury high and dry. The Frankfurt Public Prosecutor's Office has slapped charges on three more former honchos of the Canadian Maple Bank group, accusing them of aggravated tax evasion.
The Maple saga revolves around fake tax certificates that permitted the bank to illegally pocket €374 million between 2006 and 2009. You heard that right, folks! Tune in to find out more.
Once a proud institution with Canadian roots, Maple Bank, managed by the financial regulator Bafin, was shuttered in 2016, teetering on the brink of insolvency due to Cum-Ex transactions.
Former Boss in Hot Water
Cum-Ex deals, which peaked between 2006 and 2011, exploited a legal loophole: the charade involved stock trading with (cum) and without (ex) dividend claims around the dividend record date. The result? Tax authorities doling out unmerited refunds. The state closed the loophole in 2012, and in 2021, the Federal Court of Justice declared that Cum-Ex transactions amount to blatant tax evasion.
The trio getting the heat includes the former CEO of the parent company, who doubled as the chairman of the German Maple subsidiary's supervisory board. The 67-year-old is suspected of having a hand early on in the planning and execution of the Cum-Ex transactions and giving them the green light. Two others charged are a 64-year-old Brit and a 57-year-old German.
Remember, this ain't the first time Maple Bankers have landed in hot water. Previously convicted bankers have already served prison terms spanning several years. And that's just the beginning, as more proceedings related to the Cum-Ex conundrum are still in progress.
- prosecution
- tax evasion
- investigation
- Frankfurt
- CEO
- General Public Prosecutor's Office Frankfurt
BackstoryThe seismic investigation into the Cum-Ex tax evasion case underway in Frankfurt highlights Maple Bank and its former CEO, forming part of the broader German crackdown on Cum-Ex and related dividend arbitrage machinations. These manipulations have reportedly led to astronomical tax losses in the billions of euros.
Key Players- Maple Bank: A key player in the Cum-Ex tax evasion scam, facilitating dodgy dividend arbitrage transactions that resulted in fraudulent tax refund claims.- Former CEO of Maple Bank: Charges have been filed against high-ranking executives suspected of orchestrating or sanctioning these transactions. While the particular name remains undisclosed in current records, the former CEO is a vital figure under the lens of the ongoing investigation.- Frankfurt Public Prosecutors and Courts: The Higher Regional Court of Frankfurt (Oberlandesgericht Frankfurt am Main) is spearheading the case and has approved charges against former executives for tax evasion associated with these schemes[1].- German Tax Authorities: They've relentlessly pursued these cases, categorizing Cum-Ex and Cum-Cum transactions as abusive tax practices and fraud. The German Federal Ministry of Finance declared Cum-Cum deals as tax abuse in July 2021, setting the stage for the present legal actions[1].
Investigation Insights- The investigations have uncovered that Cum-Ex and Cum-Cum strategies involved rapid trading of shares around dividend payout dates between non-resident investors and German-resident banks like Maple Bank. This trading enabled multiple tax refund claims on a single dividend withholding tax, which was legally only paid once.- Authorities now view these tactics as deliberate tax evasion rather than legal tax optimization, with losses believed to have reached €28.5 billion connected to such transactions in Germany, possibly surpassing the initial Cum-Ex scandal losses[1].- The Frankfurt court’s decision to allow prosecution signals a momentous shift toward accountability in these long-standing schemes.- Prosecutors are also scrutinizing the intentions and mindset ("state of mind") of bank executives and other individuals at the time the schemes were carried out, which is essential for establishing criminal liability[1].- Broader investigations by German prosecutors involve raids on several financial institutions, including significant global banks' Frankfurt offices, shedding light on the wide-reaching nature of the tax fraud probes[3][4].
In a nutshell, the Cum-Ex tax evasion case under investigation in Frankfurt touches upon Maple Bank and its former CEO, featuring criminal charges for tax evasion. Financial recovery efforts are underway by German authorities to recover billions lost through these fraudulent deals[1][3]. It's a wild ride, folks, so buckle up!
- The ongoing investigation in Frankfurt, involving the Cum-Ex tax evasion case, has rattled Maple Bank and its former CEO, being a key part of the broader German crackdown on such schemes.
- The General Public Prosecutor's Office Frankfurt is actively pursuing charges against the former Maple Bank CEO and other high-ranking executives, accusing them of tax evasion associated with the Cum-Ex transactions.
