Bernie Ecclestone (83) to stand trial on bribery charges
F1 supremo facing possible 10-year jail sentence after being accused of €32m payment to German banker
Formula 1 boss Bernie Ecclestone will face bribery charges in Germany
Over four decades Bernie Ecclestone has seen off all comers as he orchestrated Formula One’s turbocharged growth from expensive hobby to global moneyspinner, becoming a billionaire in the process.
But the 83-year-old pit lane dictator is facing his greatest challenge yet after being told on Thursday he will be tried in Munich’s state court for bribery charges that carry a maximum 10-year prison sentence.
The trial, expected to start at the end of April, concerns allegations Ecclestone paid a German banker a €32.45 million bribe to smooth the sale of Formula One to his favoured buyer. Ecclestone denies the allegations.
He told Formula One’s board of directors he was “innocent of the charges and intends to vigorously defend the case” but said he would stand down as a director of Formula One’s holding company while he contested the claims.
True to form, however, he will continue to run the sport as chief executive – albeit “subject to increased monitoring and control by the board”. Nothing in the history of Formula One suggests he will remain anything other than hands on, though even he has conceded it will be the end of the road if he is found guilty.
Ecclestone also faces charges of incitement to breach of trust in connection with the payment to German banker Gerhard Gribkowsky, who was sentenced to eight and a half years in prison in 2012 after being convicted of accepting the cash.
Gribkowsky, the BayernLB banker responsible for selling its 47 per cent stake in Formula One to the venture capitalists CVC Partners – and a familiar figure in the paddock – was found guilty of corruption, tax evasion and breach of trust.
The indictment alleges Ecclestone and Gribkowsky agreed on the payment and sought to cover up its source and recipient and that the money was paid between July 2006 and December 2007.
In a separate civil case in London last month, German media group and former F1 shareholder Constantin Medien sued Ecclestone and other defendants for up to €106 million ($144m), claiming the sale to CVC undervalued the property.
Going over much of the same ground that was covered by Gribkowsky’s trial, at which Ecclestone appeared as a witness, the Formula One chief denied the payment to the banker was a bribe and said he was effectively blackmailed.
Ecclestone was accused of paying Gribkowsky €12m (£10m )personally, with the rest of the money coming from the Bambino family trust over which he claims to have no control.
He paid Gribkowsky, he told the court, because he feared the German banker would go to HM Revenue and Customs with unsubstantiated allegations about his tax affairs. “I made up my mind he needed to be kept quiet,” Ecclestone said, claiming he was “shaken down” by Gribkowsky.
Ecclestone said the €12m was a price worth paying as an insurance policy against the possibility that Gribkowsky might stir up trouble with the tax authorities.
“The accusations in the indictment based on Gribkowsky’s statement are unfounded and do not … add up to a coherent picture,” they said.
During the high court case a fascinating portrait emerged of Ecclestone’s vice-like grip on Formula One as he relentlessly expanded the sport into new markets in the Middle East and Asia, played media partners off against one another and kept manufacturers onside through a mixture of carrot and stick.
During the trial, shadow attorney general Emily Thornberry renewed her call for a thorough investigation of Ecclestone’s affairs by HMRC and the Serious Fraud Office.
Yet despite often claiming not to recall the detail of the complex negotiations that underpin Formula One’s ownership structure during the high court proceedings, Ecclestone’s position remained unassailable – until now.
He has a private jet and a fleet of classic racing cars but has said he sees money as simply “a way of keeping score”, leaving the ostentatious displays of wealth to his daughters Tamara and Petra.
He derives his pleasure from deal-making and at a sports business breakfast earlier this week Red Bull team principal Christian Horner, once anointed as Ecclestone’s most likely successor, insisted he remained the only man who could keep the wheels spinning.
“Bernie is absolutely the best and only guy to do what he does, to take Formula One to the global reach that the sport has achieved,” he said. “It’s in all our interests that he’s around as long as possible.”
But with the verdict in the high court damages claim due this month and Ecclestone liable to spend weeks defending himself in a German courtroom in the middle of the 2014 season, the day when the Formula One circus has to do without its longtime ringmaster could be drawing closer.