March 25, 2014 / 1:11 PM / in 4 years

UPDATE 3-Prosecutors add board member to Deutsche Bank probe

* Prosecutors say board member Leithner under investigation

* Prosecutors investigate D.Bank employees, lawyers

* Investigation on suspicion of attempted fraud

* Case relates to legal battle with Kirch heirs (Adds investigation into board member Leithner)

By Jörn Poltz and Alexander Hübner

MUNICH, March 25 (Reuters) - German prosecutors widened an investigation to include a second Deutsche Bank board member in another twist to the lender’s legal battle with heirs of late media mogul Leo Kirch that included a search of the bank’s headquarters on Tuesday.

Prosecutors said suspicions of attempted fraud by Deutsche Bank employees in the Kirch case now included Stephan Leithner, currently responsible for legal and regulatory affairs, compliance and human resources at Germany’s largest lender.

Leithner was working as an investment banker at Deutsche Bank when Kirch’s business empire collapsed in 2002.

The inquiry, which already includes Deutsche Bank Co-Chief Executive Juergen Fitschen, was expanded last week to encompass lawyers who represented Deutsche Bank in the case.

Earlier on Tuesday, prosecutors said they had conducted a fresh search of the lender’s main offices and had also searched the home of an unnamed suspect in the state of Hesse, home to Deutsche Bank’s Frankfurt headquarters.

Deutsche Bank declined to comment on the inclusion of Leithner in the investigation. Earlier, the bank confirmed its offices had been searched but declined to provide details.

The bank’s legal battle with Kirch, one of Germany’s most acrimonious corporate disputes, revolved around the late media magnate’s assertion that ex-Deutsche Chief Executive and later Chairman Rolf Breuer triggered his group’s downfall by questioning its creditworthiness in a 2002 television interview.

Kirch sought for years to recoup about 2 billion euros in damages. He died in 2011 aged 84, but his heirs carried on a battle that ended last month in a deal costing Deutsche Bank about 925 million euros ($1.3 billion).

Now prosecutors are investigating whether current Co-Chief Executive Fitschen, his predecessors Josef Ackermann and Rolf Breuer, and several others gave misleading evidence in the civil suit brought by Kirch’s heirs.

The prosecutors have said they aim to wind up their investigation by the middle of the year.

Previous prosecutor raids in late 2012 in the Kirch case, and an unrelated carbon tax fraud investigation, had involved hundreds of officers and a score of police vehicles.

State prosecutors have also recently searched offices of law firms connected with the Kirch case. Hengeler Mueller, which had advised Deutsche Bank, said on Monday its Frankfurt offices had been searched last week.

A second law firm, Gleiss Lutz, said on Tuesday its offices in Munich were also subjected to a search last week.

$1 = 0.7255 euros Additional reporting by Arno Schuetze and Jonathan Gould; Editing by Louise Heavens and Mark Heinrich

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