What did the banker know about the Cum-Ex scandal?

What did the banker know about the tax theft? – Page 1

Christian Olearius may have tossed and turned in bed the night before this day. In any case, his silver hair at the back of his head is visibly sticking up as he enters the large hall of the Bonn District Court two minutes before 10 o’clock, as always elegantly dressed in a dark blue suit, the uniform of Hamburg merchants, and a light blue tie.

He is surrounded by four defenders, who act as bodyguards and shield him from the numerous cameras. The images are as uncomfortable for him as they are historic: for the first time, a former bank CEO is standing trial for Cum-Ex deals, accused of tax evasion with damages amounting to 280 million euros. The 81-year-old faces a lengthy prison sentence and the prospect of spending his remaining years primarily behind bars.

When the presiding judge wants to ask for his personal information as usual, Olearius immediately stands up. She tells him he can remain seated. Whether this is correct: Dr. Christian Gottfried Olearius, born in 1942 in Oberglogau in Upper Silesia, residing in Hamburg? „Yes,“ Olearius says clearly and distinctly.

Then he must listen. The two representatives of the prosecution in black robes read out the extensive 370-page indictment, alternating, a procedure that lasts several hours.

They explain in detail how Cum-Ex transactions work and how Olearius, his employees at the Hamburg private bank M.M.Warburg, and numerous „accomplices“ such as lawyer Hanno Berger agreed in 2006 to set up complex circular transactions with stocks of German companies like Siemens and Volkswagen. These transactions had only one goal: to claim a refund of capital gains tax and solidarity surcharge from the tax office, even though no one had ever paid them before. One could also say: a massive tax theft.

Olearius habe „die maßgeblichen Entscheidungen“ dazu bei Warburg getroffen, sagen die Ankläger. Er habe die Abläufe gekannt und sei bei Schwierigkeiten von seinen Mitarbeitern persönlich eingebunden worden. Schließlich war er damals nicht nur der persönlich haftende Gesellschafter der Bank, sondern auch der Hauptanteilseigner, gewissermaßen das Zentrum der Bank. 

The defendant listens without showing any emotion, occasionally taking a sip of water from a small plastic bottle. The upcoming months in Bonn will focus on this very question: What did Olearius personally know and do, and what was his personal involvement in these dealings? It has long been established that these activities were illegal. The Federal Court of Justice definitively ruled in 2021 that it was never legal to claim tax refunds for taxes that were never paid, regardless of what highly paid lawyers may have imagined or believed to have found in supposed legal loopholes. The Warburg Bank has already repaid 247 million euros, including interest, to the tax authorities.

Bislang keine Demut von Olearius

It is inevitable that Christian Olearius is now sitting in court. His right-hand man at the bank, his long-time general attorney Christian S., was already sentenced to a prison term of five years and six months in the same courtroom in Bonn in June 2021, which is now legally binding. „We don’t believe you!“ the judge said quite clearly during the pronouncement of the verdict, after S. had tried to deny everything. For the court, it is „completely clear“ that Warburg continuously and knowingly engaged in illegal Cum-Ex transactions. The punishment was not even higher only because the defendant was already quite old and had to wait a long time for his trial.

These are unfavorable circumstances for Olearius. Because he, too, has shown a lack of humility in recent years regarding the Cum-Ex issue. His defense has always been offensive: he claimed to have believed the transactions were lawful, stating that others had deceived him. In legal terms, this means he denies any intention.

Eine „Sündenbock-Projektion“?

To defend himself, Olearius also chose well-built lawyers who reassured him that he was actually just the victim of a „scapegoat projection“. This is how Peter Gauweiler formulated it during his powerful appearances in the parliamentary Cum-Ex investigation committee at Hamburg City Hall. Gauweiler extensively talked about other banks that were much worse than Warburg, unfair journalists – but there was no mention of Olearius‘ responsibility.

This battle is about the life’s work of one of the most well-known bankers in Hamburg, who was not accustomed to setbacks but had a good reputation in the city for many years. This is mainly because he saved the shipping company Hapag-Lloyd from being sold to Asia by forging a rescue alliance. Whenever politics had a problem, Olearius was often helpful. He once helped the building senator acquire 40,000 apartments from the construction company Neue Heimat, assisted the economy senator in selling the Hamburg steelworks to an Indian corporation, and of course, was also there when the Elbphilharmonie needed donations.

Bisher keine Beweise gegen Olaf Scholz

In 2016, Olearius found himself in need of political assistance. The Hamburg tax office had verbally announced their intention to reclaim wrongfully refunded taxes from Warburg’s Cum-Ex transactions. Olearius now hoped that the SPD would be there for him this time.

Es geht auch um Scholz‘ Glaubwürdigkeit

Er ließ sich unter anderem vom damaligen SPD-Bundestagsabgeordneten Johannes Kahrs beraten, dessen Kreisverband Hamburg-Mitte er dann später mit Parteispenden bedachte. Und er traf sich dreimal mit dem damaligen Bürgermeister Olaf Scholz im Hamburger Rathaus.
During one of these meetings, Olearius handed over a letter to Scholz at the town hall regarding the tax case, which, according to the prosecutors, contained „numerous factually incorrect statements and distorted representations.“ Scholz then advised Olearius to send the letter without any comments to the former finance senator and current mayor, Peter Tschentscher (also from the SPD). He forwarded it to the relevant staff members, requesting information on the current status.

At least in the short term, Olearius was successful: The Hamburg financial authorities refrained from reclaiming millions from Warburg in 2016 and 2017. Only a directive from the Federal Ministry of Finance at the end of 2017 finally forced them to do so. The investigative committee in the town hall has been trying to determine to what extent political influence led to the leniency of the Hamburg authorities, through many sessions. Olaf Scholz has already been questioned twice. He stated that he could no longer remember the conversations with Olearius. The opposition does not believe him. However, concrete evidence of influence is lacking, all witnesses from the financial administration have denied it.

So geht es in dem Bonner Prozess am Rande also auch um Scholz und seine Glaubwürdigkeit. Spannend dürfte es vor allem werden, wenn Olearius selbst spricht. Das werde er im Laufe des Verfahrens noch tun, kündigte sein Anwalt Gauweiler zum Verhandlungsauftakt an, der so etwas wie der Wortführer der vier Verteidiger ist. Olearius werde sich auch Fragen des Gerichts stellen, allerdings erst, wenn die Zeugenvernehmungen beendet seien. 

On the first day, Olearius sat there for hours and listened to what was being accused of him. In fact, it made his hair stand on end a little.