Cum-Ex tax scandal: Former senior public prosecutor Brorhilker: “Cum-Ex continues”

Former Cum-Ex chief investigator Anne Brorhilker is firmly convinced that tax fraud with illegal stock transactions is still widespread in the financial world. “Cum-Ex continues – even long after the change in the law in 2012,” said the former senior public prosecutor and current managing director of the citizens’ movement Finanzwende of the German Press Agency.

Cum-ex deals, which peaked between 2006 and 2011, are considered the largest tax heist in the history of the Federal Republic. Banks and other investors staged a confusion game with stocks around the dividend record date. In the end, they received tax refunds from tax offices that they had not paid at all. The state is estimated to have lost at least ten billion euros; in 2012, politicians responded by changing the law.

“The deals are definitely still possible”

But according to Brorhilker, the tax robbery continued afterwards. As an example, she cites a foundation set up by suspected criminals that was used for cum-ex deals in 2016. In their opinion, the likelihood that cum-ex transactions and related cum-cum deals will still be carried out is high.

“It is always said that the transactions are now technically impossible because the regulations have been changed,” said Brorhilker, who was responsible for cum-ex cases at the Cologne public prosecutor’s office from 2013 to spring 2024. But the perpetrators carried out cum-ex deals across Europe and therefore also in countries with different regulations and systems than in Germany. “The perpetrators may have to handle the deals a little differently, but they are definitely still possible.”

The risk for banks of being discovered in criminal activities is still very low, said Brorhilker. “The banks know: Nobody can prove it to us. We have a control deficit, no matter what rules we set up.”