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Bloomberg
Bank of New York Mellon’s Frankfurt offices are being raided by Cologne prosecutors as part of their vast investigation into the controversial Cum-Ex scandal that has increasingly ensnared Wall Street’s biggest banks.
The raid began on Tuesday, people familiar with the process said. A spokesman for Cologne prosecutors said searches at two unidentified banks started and included the homes of employees who are suspects in the case. More than 120 officers are involved, including tax investigators from three German states. The investigators are also looking for evidence of deals similar to Cum-Ex, he said.
Cum-Ex was a trading strategy that siphoned off at least $10 billion in government revenue. Named for the Latin term for “With-Without,†the deals took advantage of German tax laws that seemed to allow multiple investors to claim refunds of a tax on dividends that was paid only once.
The nation moved to abolish the practice in 2012.