Switzerland wants to extradite a lawyer who German officials accuse of being the architect of a years-long tax fraud.
Swiss justice officials ordered Hanno Berger's extradition to Germany in an administrative decision, according to a Swiss government spokesman. Berger is credited with popularizing cum-ex products with German clients: the tax-savings products have come under heavy fire from German officials.
Berger, who is German, was arrested in the Swiss canton of Grison early last month at the request of Germany. His lawyer, Kai Schaffelhuber, indicated he believed in a political dimension to the probe. «I always thought that the Swiss administration would rather not want to withstand the extreme political pressure from Germany and rather leave the decision to the courts,» he told finews.com.
Rebates On Non-Payments
German tax officials want to recoup money they believe was stowed in the products, by which wealthy clients moved shares with (cum) and without (ex) dividend rights at and around the ex-date back and forth in quick succession. As a result, tax authorities lost track of who was the actual owner of the stock.
Ultimately, the finance departments returned tax on capital earnings that in fact never had been paid in. Two weeks ago, Germany's federal court ruled cum ex products are an illegal form of tax evasion (ruling in German). Countless wealthy Germans were caught up in the scheme, as were Swiss wealth managers.
Hardening Stance
The German court ruling indicates a hardening stance on what was previously viewed as a loophole. German media have reported that as much as 5.3 billion euros ($6.25 billion) was defrauded during the scheme, which ran from 2005 until 2012.
The extradition of Berger isn't a done deal: he can appeal within 30 days to Switzerland's highest court. Schaffelhuber, his lawyer, indicated Berger planned to appeal extradition through Swiss lawyers.
