BREAKING: French and German Authorities Raid Banks in €100 Billion Tax Fraud Probe
On Tuesday, French and German authorities launched coordinated raids in and around Paris concerning an ongoing investigation into possible tax fraud.
The raids targeted four French banks, including Societe Generale, BNP Paribas, Exane, and Natixis, and HSBC, an international bank. The Financial Prosecutor’s Office in France said the banks are suspected of money laundering and fiscal fraud, with Societe Generale, BNP Paribas, and Exane also suspected of aggravated tax fraud.
The investigation is linked to a probe opened by the French authorities in December 2021. It involves 16 investigating judges and over 150 investigation agents, according to a statement issued by the Financial Prosecutor’s Office. Six prosecutors from Cologne, Germany, were also involved in the raids.
“Cum cum” practices have been widely used in the banking industry for decades. Still, they came under scrutiny in 2018 following a reporting project by the German investigative media outlet Correctiv called the “CumEx Files.”
The project revealed that banks, stock traders, and lawyers managed to split dividends in a way that allowed them to avoid paying as much as $62.9 billion in taxes across Europe. Germany and France were the biggest victims, with losses of approximately $36.2 billion and $17 billion, respectively.
The German government was embroiled in a major scandal involving top officials, including Chancellor Olaf Scholz. He was summoned to testify thrice under oath regarding his ties to the Warburg Bank and his awareness of its operations.
Tuesday’s search and seizure operations indicate that the French and German authorities are actively pursuing individuals involved in the “cum cum” scandal and remain dedicated to eliminating tax evasion.