German tax investigators raid Deutsche Bank headquarters in Frankfurt

German authorities on Wednesday raided Deutsche Bank’s headquarters in Frankfurt as part of an investigation into so-called cum-cum transactions, which involves multiple financial institutions exploiting a loophole in tax laws, media reports said.

Since early morning, approximately 70 investigators from the public prosecutor’s office and the tax investigation unit have been searching the bank’s headquarters.

The raid is reportedly part of an investigation into suspected tax evasion involving cum-cum transactions.

According to German daily Bild, the search is being led by the Duesseldorf public prosecutor’s office.

Deutsche Bank confirmed the search and said it was cooperating with authorities.

Just last week, the public prosecutor’s office confirmed a raid at a Deutsche Bank branch in Frankfurt’s city center but declined to provide further details.

The latest investigation centers on transactions under the code name “Riesling,” involving cum-cum deals conducted by Postbank, which Deutsche Bank acquired in 2009.

Postbank reportedly carried out the transactions with a British investment bank between 2008 and 2010.

According to German daily Sueddeutsche Zeitung, 10 former senior Postbank executives are among the suspects.

Previous money-laundering investigations

In cum-cum transactions, participants in Germany and abroad transfer shares in German companies around the dividend record date to reduce withholding tax on dividends.

The transactions generated tax advantages for foreign holders of German shares.

German tax authorities are estimated to have suffered losses of around €28 billion (about $32.5 billion).

Unlike criminal cum-ex deals, cum-cum transactions are not illegal in themselves. However, courts and investigators are increasingly examining whether specific arrangements amounted to tax evasion.

Around 3,000 people work at Deutsche Bank’s twin-tower headquarters in Frankfurt. This is not the first time the buildings have been searched.

In January, the Federal Criminal Police Office conducted searches at the bank’s Frankfurt and Berlin offices over suspected delays in reporting possible money laundering, including cases linked to Russian oligarch Roman Abramovich.

Investigators also searched Deutsche Bank’s Frankfurt headquarters in 2022 over suspected money laundering.