Cum-Ex tax scandal: A breakfast that raises questions

Did former SPD leader Kahrs want to help private bank MM Warburg keep the loot in the Cum-Ex scandal? The prosecutor is investigating. documents that dem WDR available, provide an insight into an explosive meeting.

The German Parliamentary Society is an exclusive association. If you want to dine in the “Club of Members of Parliament” in the magnificent ambience of the former Reich President’s Palace in Berlin, you should be a member of the German Bundestag, a state parliament, the Bundesrat, the federal government or the government of a federal state. On the morning of April 2, 2019, two club members used this protected room for a confidential breakfast: Johannes Kahrs, then spokesman for budgetary policy for the SPD in the Bundestag, and Jörg Kukies, then State Secretary of the Federal Ministry of Finance. The PG, as MEPs call it, seemed like the perfect place to exchange views on budgetary and financial issues.

But this morning, another guest who is not otherwise a member joined the breakfast group: the Hamburg private banker Christian Olearius. The owner of the traditional bank MM Warburg got into the car early in the morning to attend the meeting. He was in an awkward position. Olearius was already one of the accused in Germany’s biggest tax scandal – Cum-Ex. The suspicion: Olearius is said to have had taxes reimbursed with his Warburg-Bank and other consultants, bankers and stock traders that they had never paid before – a dig into the state coffers.

Breakfast with an explosive topic

Olearius feared for his bank’s existence if it had to repay the cum-ex funds. It was about millions of dollars. He felt innocent and treated unfairly. In his eyes, the financial authorities were targeting the small traditional Hamburg bank, while the big ones were being left to their own devices. He needed to speak and obviously wanted to convince State Secretary Kukies of his point of view over breakfast. A few weeks after breakfast, the first cum-ex trial began before the Bonn Regional Court, in which the Warburg Bank also had to answer as a secondary party.

The fact that this breakfast with explosive content even existed became public last summer through a small inquiry from the Left Party and caused unrest in the federal election campaign. After all, it was the state secretary to the finance minister and SPD candidate for chancellor, Olaf Scholz, who exchanged views with the accused Warburg banker at a time when the cum-ex investigations against Warburg and Olearius had long been known.

Scholz made the headlines himself during the election campaign because he had met Olearius several times during his time as Hamburg’s first mayor in 2016 and had also talked to the banker about Cum-Ex. In fact, the Hamburg tax authorities later waived the repayment of 47 million euros from cum-ex transactions. In Hamburg there is now a committee of inquiry.

Kukies unknowingly lured into the meeting?

There was no influence, the Hamburg managers affirm in unison. Previously unknown documents that dem WDR are available, now bring further details to the breakfast date to light. The online platform “Ask the State” had requested all information about the meeting between Kukies, Kahrs and Olearius under the Freedom of Information Act and the WDR made available.

At least on paper, it now reads as if Kukies was unwittingly lured into the meeting. This is exactly how the story is told in Treasury circles. Accordingly, Johannes Kahrs’ office sent an email to Kukies’ secretary on March 19, 2019. It was about the meeting they just talked about on the phone. The Kahrs office offered to reserve a “quiet spot” in the Parliamentary Society. On March 27, Kukies’ anteroom asked whether Kahrs was taking the appointment “solo” or whether someone else was coming along. On the same day, Kahrs’ office confirmed that the SPD MP “appears alone in the honorable PG”.

Raid on Kahrs

If Kahrs actually deceived the state secretary, that could put him under further pressure. Finally, the Cologne public prosecutor is investigating the politician, who surprisingly resigned in 2020, on suspicion of favoritism and searched several of his apartments during a raid in the autumn.

The prosecutors are investigating whether Kahrs could have helped the Hamburg private bank MM Warburg keep illegal cum-ex booty. The main question regarding the meeting is: Did the SPD politician use his access to get Olearius to hear his tax problem at the highest level? Anyone who helps someone to secure the benefits of an alleged criminal act makes themselves liable to prosecution. In the Criminal Code, this is recorded as “favoring” – and can be punished with up to five years in prison.

Olearius’ lawyer: Kukies knew

Kahrs left several inquiries about the breakfast unanswered. The Federal Ministry of Finance also did not go into the course of the appointment and referred to the answer to the small question. Kukies, who has since been promoted to State Secretary in the Federal Chancellery and a top advisor to Chancellor Scholz, did not attend the breakfast either.

Private banker Olearius, on the other hand, apparently has a completely different memory. Through his lawyer, Peter Gauweiler, he says he would never have gotten into his car early in the morning if it hadn’t been perfectly clear that Kukies would receive him. “The State Secretary was therefore not at all surprised that Mr. Olearius was present. There was not a single comment from Kukies that he had not been informed,” says Gauweiler, describing his client’s memories.

No support from Kukies

The meeting in an exclusive circle is all the more remarkable because Kukies had given the Hamburg banker a harsh rejection in writing just a few months earlier. Olearius had already asked on July 7, 2018 to give the responsibility for the tax procedure back to the Hamburg tax office – possibly in the hope that his bank would be treated better. It would be in the common interest of the Federal Ministry of Finance and the bank to solve the cum-ex problem as quickly as possible.

A handwritten note on Olearius’ letter reads: “We must make it clear that we cannot and do not want to help with almost all of his requests”. In fact, the Secretary of State replied a little later. Kukies wrote in 2018 that he could not comply with the request for support.

Actually, the process could have ended here. But apparently Kahrs brought the banker Olearius back into play with breakfast. However, according to the Federal Ministry of Finance in the answer to the small question from the left, it did not help. State Secretary Kukies reaffirmed at breakfast that he did not share Olearius’ assessment.