A former risk controller at Warburg Bank is allowed to leave the dock early. The trial against the ex-chief lawyer and the former head of accounting continues.
The Bonn regional court has discontinued the proceedings against the former risk controller K. in exchange for payment of 40,000 euros; half of the money will go to the state treasury and half to non-profit organizations.
The charges against Bernd E. and W. continue. They are accused of serious tax evasion, while K. is only accused of aiding and abetting.
As the former head of the legal department at Warburg, Bernd E. is said to have played a central role in the Cum-Ex business and persisted in continuing it despite warnings of risks.
W. headed the accounting department at Warburg. He is said to have organized cum-ex transactions.
Cologne. It is a novelty in the Cum-Ex scandal: For the first time, a criminal case against a defendant ends without a conviction. The Bonn regional court has discontinued the proceedings against K., a former risk controller at the Hamburg private bank M. M. Warburg, against payment of 40,000 euros.
Half of the money goes to the state treasury and half to two non-profit organizations. The basis is Section 153a of the Code of Criminal Procedure, as a court spokesman announced. The legal publisher Juve first reported on the hiring.
The proceedings against the two co-defendants Bernd E. and W are continuing. They must continue to answer on suspicion of serious tax evasion. The trial against E. and W. is scheduled to continue in November.
A key difference lies in the involvement they are accused of: According to the public prosecutor, E. and W. are said to have evaded taxes together, while K. was only accused of aiding and abetting.
The proceedings against the original three defendants began on March 24th in the Siegburg branch of the Bonn Regional Court. The focus is on cum-ex transactions - i.e. the trading of shares with (cum) and without (ex) dividends between 2007 and 2011. According to the indictment, Warburg Bank had capital gains taxes refunded that had not previously been paid. The damage is said to amount to 278.6 million euros.
Ex-chief lawyer at the center of the allegations
The main defendant in the case is E. For more than two decades he was head of the legal department and responsible for the bank's legal issues. According to the public prosecutor's office, he also played a central role in the cum-ex transactions. He is said to have had a say in deciding which models were legally justifiable and whether the transactions would be implemented. E. rejected the allegations before and during the proceedings.
According to the investigators, however, the long-time bank boss Christian Olearius in particular is said to have worked closely with the lawyer. E. was informed early on about the risks of the transactions, on which the bank sought advice from tax lawyer Hanno Berger. The proceedings against Olearius were discontinued in mid-2024 due to the defendant's inability to stand trial.
The investigators attribute the former chief lawyer E. to a key role in the drafting of an “Investment Partnership Agreement”. The contract regulated the collaboration between Warburg and the financial company Ballance as well as the distribution of profits. Ballance handled a majority of the deals. According to the prosecutors, E. also knew that the Swiss bank Sarasin was issuing “fictitious invoices” in order to allow the lawyers involved, Berger and his partner Kai-Uwe Steck, to share in the loot.
Tax risk warnings
Even when the legal risks increased from 2009 onwards, according to the public prosecutor's office, E. did not raise any fundamental objections to continuing the business. The Federal Ministry of Finance had previously warned against abusive tax refunds.
In an email, E. explained the risks of duplicate tax certificates, but apparently did not draw the conclusion of fundamentally terminating the business. In a confidential note he is also said to have stated that the tax authorities had identified a possible double certification of capital gains tax.
From 2009 onwards, the tax authorities required additional confirmation from lawyers or tax advisors that there had been no agreements between those involved. However, according to the public prosecutor's office, such coordination did indeed take place - including in the transactions in 2010 and 2011.
Balance sheet boss W. also continues to go to court
In addition to E., the defendant W. also has to continue to face the trial. He headed the balance sheets, accounting and controlling department at Warburg. However, W. only came to the bank at the end of 2009 and in 2010 took over the duties of his predecessor, Christian S., who was sentenced to five and a half years in prison.
W. is said to have organized the cum-ex business. Without his approval, the transactions might not have been implemented. He is also said to have maintained contacts with external dealers and consultants from the Ballance Group environment and to have taken part in meetings in London.
W. is also said to have been involved in continuing the business in 2011. He created a template for the bank's partners, on the basis of which further transactions were carried out. W. is said to have already recognized and addressed the significant tax risks. Nevertheless, as head of accounting, he signed the corporate tax return for 2010 together with Olearius.
In addition, another main hearing against the tax officer Daniela P., who was originally charged together with E., W. and K., is imminent in the Warburg complex. In 2016, P. was head of the department in the Hamburg tax office for large companies when the tax authorities did not demand back the wrongfully refunded capital gains tax from M. M. Warburg.
The regional court initially did not allow the charges against P., but the Cologne Higher Regional Court finally did so with a decision of August 10, 2026.
