German chancellor under pressure over 'cum-ex' scandal

BERLIN (AA) - German Chancellor Olaf Scholz has come under growing pressure following a series of new revelations about the “cum-ex" tax avoidance scandal.

Opposition Christian Democrats (CDU) on Friday heavily criticized Scholz and his Social Democrats (SPD) for hindering a deeper investigation into the tax fraud, and its possible links to politicians.

"It is shocking to see how SPD politicians are building a stone wall, most recently Chancellor Scholz, with his comments during the news conference at the Federal Press Center,” Goetz Wiese told local media.

Opposition politicians assert that Scholz and his aides exerted political influence six years ago to help Warburg Bank avoid paying back €47 million ($48.2 million) in illegal tax refunds, while Scholz was the premier of the northern state of Hamburg.

The chancellor dismissed the claims during a news conference on Thursday at the Federal Press Center, but did not give clear answers to questions about his meetings with Warburg Bank’s senior executives, and former SPD lawmaker Johannes Kahrs at that time.

He said all these claims have been investigated by a parliamentary committee for more than two years.

“After listening to all relevant persons, there is not a single indication that there was any political influence on this decision,” Scholz said, referring to the decision of Hamburg tax authorities about Warburg Bank.

Investigators have recently found more than €200,000 in cash, in a safe deposit box of former lawmaker Kahrs, which has triggered speculations in media about his involvement in the tax fraud.

Scholz is scheduled to testify next week before a parliamentary panel investigating the claims, often referred to as the “cum-ex" scandal in media.

Warburg Bank and dozens of other financial institutions are believed to have involved in a massive stock trading scam between 2002 and 2012, helping their clients trick governments, and claim a refund for a tax they had never paid for.

The “cum-ex" scandal is estimated to have cost German taxpayers billions of euros.