The main suspect in this case is the head of the London fund company Duet.
(Photo: Reuters)
Cologne The fund company Duet from London is only known to insiders – in the cum-ex business, however, it was very active. The district court in Bonn has now opened proceedings against four – some of them former – managers of the money company. “By decision of February 3, 2023, the 9th major criminal chamber admitted the charge of the Cologne public prosecutor’s office from September 22, 2022 to the main hearing,” said a court spokeswoman.
The prosecutors accuse the four managers of serious tax evasion. “By autumn 2009 at the latest, the accused should have joined forces with others and taken the joint decision to do cum-ex deals from 2010,” the court said. The Latin term refers to share group transactions with (cum) and (without) dividends, which were aimed at offsetting or refunding capital gains tax not previously withheld.
The criminal trial is scheduled to begin as early as March 20 – initially, however, in a skeleton occupation with only one accused. The court dismissed the case against the other three defendants. For organizational reasons, it would hardly have been possible at the moment to hold a main hearing with four defendants and two or three defense lawyers each.
Duet is a fund company based in London that is said to have organized cum-ex trading in securities. The case now under discussion involves two funds. In one case, those involved managed to get around 92 million euros out of the tax coffers. In the other case, the damage would have been even greater if the Federal Central Tax Office had not refused payment at the last minute.
Proceedings against senior management will come later
According to information from the Handelsblatt, the Duet leaders are not initially affected. The main suspect is Duet boss Henry Gabay. He had already told the Handelsblatt that he wanted to face a trial in Germany. Gabay emphasized that he considers himself innocent. He is not a tax lawyer and relied on the advice of experts. However, it is not yet clear when he and his two former colleagues will stand trial.
In March, a Duet employee from the back office will first have to answer. In the meantime, he was in custody in the Cologne-Ossendorf correctional facility. He was also released after paying bail. “You will understand that my client will at best comment on the allegations in court, but not beforehand via the press,” his defense attorney said when asked.
It is known that Duet had the law firm Freshfields Bruckhaus Deringer prepare an expert opinion. Today, former Freshfields partners are among the accused themselves. The former global head of tax at the top law firm will soon have to answer to the Frankfurt Regional Court together with an ex-colleague. Duet also maintained contact with tax attorney Hanno Berger, who was recently sentenced to eight years in prison. The judgment is not final.
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