According to a deduction of five internal audits of Deutsche bank, there had been many indications that the much-debated and scandalized Deutsche bank might be involved in a share-trading scheme, which was likely to be a subject to the biggest post-war fraud investigation in Germany.
According to court documents, the German prosecutors had been quoted saying that the bank might have been linked with a complicated fraudulent activity, which allowed the scheme’s participants to mislead the government to take advantage of tax refunds.
According to the summation of the audits, the bank had been issuing tax certificates for withholding tax, which had never been deducted. Alongside, they made loans to the clients in order to allow them to participate in the scheme for claiming the tax refunds.
The scheme, called as, “cum-ex”, had been involved with misleading governments, which had costed the nation 5.6 billion euros in refund, which should not be paid. Regarding this daedal and distressful accusations of fraud, a Freshfields Audits said, “Even though evidence is not clear-cut, there are a lot of indications that the staff of SETG (Strategic Equities Transactions Group) and managers, who were responsible for Prime Brokerage at the SEF-IM (Structured Equity Finance — Inventory Management) trading desk, discussed the reputational risk for Deutsche Bank from its provision of finance in January 2009 and came to the conclusion that this was acceptable. ”