Cum-Ex key figure Hanno Berger sentenced to eight years in prison Reich citizens apparently hoarded weapons for “purge”

The Bonn regional court has sentenced the architect of the cum-ex share transactions, Hanno Berger, to eight years in prison. The court ruled on Tuesday that the 72-year-old was guilty of three counts of tax evasion. The verdict is not yet legally binding.

The possible maximum was 15 years, the public prosecutor had demanded nine years in prison. The defense had admitted misconduct by their client, but the magnitude of it was significantly less than presented by the prosecutor. The crimes covered the period from 2007 to 2011.

Berger is the best-known protagonist of the business model, which was declared a criminal offense by the Federal Court of Justice in 2021. He advised banks, funds and investors in establishing transactions and recruited high net worth clients through his network. He made millions for it. Formerly a civil servant at the Hessian tax office, he later switched sides and provided the financial actors with in-depth knowledge of tax law.

Dropped off in Switzerland

At the end of 2012, tax expert Berger fled to Switzerland, where he managed to evade German justice for years. It was only delivered in Germany in February 2022. Parallel to the Bonn proceedings, there is still a criminal case against him at the Wiesbaden court, where he is charged with further cum-ex-offences.

Berger did not come up with the business model in which shares with («cum») and without («ex») dividend rights were deferred around the dividend record date and taxes not paid at all were refunded. However, he is considered a pioneer in exploiting Cum-Ex on a large scale in Germany. The German state has lost a double-digit billion euros due to cum-ex.

“Hanno Berger was one of the central minds behind the illegal cum-ex-business” and “a kind of spin doctor,” said Gerhard Schick of the Finanzwende citizen movement in Berlin, in view of the court’s ruling in Bonn. “He made Cum-Ex big among wealthy private investors.”

Process flood expected

Schick called for more speed in handling the tax scandal. “We are in the eleventh year since such transactions were stopped, and despite more than 1,500 suspects, the suspects are few and far between,” he criticized. The cum-ex clarification went at a snail’s pace for years, “because many prefer to sweep the subject under the rug”.

The processing of the largest tax scandal in the Federal Republic will probably take years. To cope with the deluge of foreseeable processes, a new building is being built in the neighboring city of Siegburg in Bonn for future cum-ex processes. The building is scheduled to be delivered in 2024. (aeg/sda/awp/dpa)