KEY POINTS:
A secret supergrass, German spies, a €4 million ($7.37 million) CD and the principality of Liechtenstein. These are the ingredients for a tax dodge mystery that some are describing as Germany's biggest financial scandal since the World War II.
Police, tax investigators and state prosecutors began searching hundreds of homes and offices throughout Germany yesterday, swooping on addresses in Munich, Hamburg, Stuttgart, Ulm and Frankfurt in a bid to unravel the fraud and root out an estimated 1000 tax evaders suspected of illegally transferring up to €4 billion to secret accounts in Liechtenstein.
The first evidence of a scandal emerged at the end of last week following the sudden resignation of the Deutche Post chief executive, Klaus Zumwinkel, over claims he evaded €1 million ($1.84 million) worth of tax over 20 years, allegedly depositing the cash in a Liechtenstein account.
The scandal exploded over the weekend, with officials at Germany's secret service, the Bundesnach-richtendienst (BND), disclosing that they had gleaned information about a more widespread fraud from a CD containing records from Liechtenstein's LGT bank that they had purchased from an unidentified informant.
The CD was said to contain detailed evidence about secret accounts held by hundreds of German clients.
"We consider that the €4 million we paid out for the CD was a good investment on behalf of the German tax payer," a BND spokesman said.
A spokesman for the state prosecutor's office in the west German city of Bochum, which began the hunt for tax evaders on the basis of the BND's information, said that the CD had effectively "cracked the entire bank".
But yesterday Bernd Bienossek, the chief Bochum state prosecutor, declined to comment on the scale of the hunt for tax evaders, many of whom have been described as "prominent".
Police in at least five German cities admitted that raids had taken place and that several individuals who were suspected of tax evasion had already turned themselves in. The hunt was likely to continue for weeks.
Zumwinkel's resignation followed raids by tax fraud investigators on his Cologne villa and Deutsche Post's headquarters in Bonn. He was taken by police escort to the offices of state prosecutors. Police removed several boxes of documents from his home.
Zumwinkel was regarded as a pillar of the business establishment and had received awards for his success in transforming German postal services. He is suspected of illegally depositing funds in the tax haven of Liechtenstein since the early 1990s.
The public reaction to Zumwinkel's resignation and to the growing evidence of a major tax fraud has been one of shock. The Chancellor, Angela Merkel, is expected to discuss the issue with Liechtenstein's Prime Minister, Otmar Hasler, when he visits Berlin today.
- INDEPENDENT
