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Prosecutors raid German UniCredit unit in tax probe
November 29, 2012 / 11:46 AM / 5 years ago

Prosecutors raid German UniCredit unit in tax probe

FRANKFURT (Reuters) - State prosecutors raided the Munich offices of UniCredit SpA’s German unit HVB as part of a tax evasion probe relating to share deals several years ago, HVB said on Thursday.

The raids, which were instigated at the behest of Frankfurt prosecutors on Wednesday, were carried out by a team of 60 police, tax inspectors and federal criminal investigators.

Eight people were being investigated on suspicion of deliberate tax evasion, Frankfurt prosecutors said, declining to provide the names of the suspects.

Prosecutors are investigating possible tax evasion in connection with share transactions in 2006-2008, HVB said.

The lender said it had also informed Munich tax authorities that it had timed certain proprietary trades close to dividend payments and may have claimed tax credits related to the transactions.

“The capital gains tax credits that resulted from these transactions are being queried by the tax authorities,” it said.

It said it was cooperating with authorities but added it could not comment further because the matter is subject to an ongoing investigation.

Germany’s finance ministry declined to comment.

According to German daily Sueddeutsche Zeitung, HVB is being probed for helping with a tax rebate strategy connected to “dividend stripping,” where a stock is bought just before losing rights to a dividend then quickly sold.

A source familiar the process said HVB is said to have issued documentation to a third party Frankfurt-based investor which helped the investor claim certain unwarranted tax rebates.

Prosecutors suspect that as a result of this scheme, taxes of around 124 million euros ($160.1 million) were illegitimately claimed, the source familiar with the process said, but declined further comment.

Reporting by Andreas Kroener, Tilman Blasshofer, Edward Taylor and Ludwig Burger, Matthias Sobloweski in Berlin and Silvia Aloisi and; Editing by Maria Sheahan and David Holmes

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