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German prosecutors raid Commerzbank in tax evasion probe

German prosecutors raid Commerzbank in tax evasion probe

 

FRANKFURT: Germany’s Commerzbank (CBKG.DE) has become the target of a tax evasion probe in which several current and former managers are suspected of evading 40 million euros ($47 million) in taxes via so-called dividend stripping.

Prosecutors said on Friday they had searched the offices of a major Frankfurt bank and private homes this week. The bank involved was Commerzbank, according to a person familiar with the matter who was speaking on condition of anonymity.

Commerzbank, Germany’s second-biggest lender, said it was cooperating with authorities. Dividend stripping, also known as “cum-ex” transactions, involved buying a stock just before losing rights to a dividend, then selling it, taking advantage of a now-closed legal loophole that allowed both buyer and seller to claim tax credits.