Deutsche Bank fined €59m after tax probe

Deutsche Bank, Germany's largest financial institution, has been fined nearly €60 million for helping customers evade tax through offshore bank accounts.

A court in Frankfurt imposed the fine in exchange for halting the investigation of 800 employees of the bank, including senior managers, suspected of helping customers anonymously move capital abroad.

A Deutsche Bank spokesman said the company, believed to have earned €5 million in fees from the transactions, would not appeal against the decision and would pay the €59.3 million fine.

Authorities searched Deutsche Bank offices in 1998 as part of their investigation and discovered that, between 1992 and 1996, employees of Deutsche Bank, and two other banks, organised fund transfers to Luxembourg and Switzerland to avoid a new savings tax.

Since the investigation began, thousands of customers have paid around €150 million in back taxes.

The state prosecutor believes that board members were involved in the business and were aware of the illegal transfers but had not initiated the practice.

The court ordered several employees of the bank to pay individual fines totalling €4.5 million.

Prosecutors have closed a similar investigation against Commerzbank and 30 of its employees, after the bank paid a reported fine of €31.2 million.

The Hessische Landesbank (Helaba) is still under investigation.

The announcement came as Mr Josef Ackermann, Deutsche Bank's embattled chairman, revealed details of his salary.

Mr Ackermann earns €6.95 million per year, a third of which is paid in stock and options worth more than €2 million.

Swiss-born Mr Ackermann has had an eventful time since taking over from Mr Rolf Breuer as chairman of Deutsche Bank.

State prosecutors investigating the sale of Mannesmann to Vodafone have charged Mr Ackermann and other former Mannesmann board members with breach of trust against shareholders for distributing payouts to company officials after agreeing the takeover after the bitter boardroom battle.