Dresdner protests against 'bullying' inspectors

DRESDNER BANK strongly protested yesterday at what it described as bullying tactics by German investigators who have been searching the bank's main offices for evidence of illegal money transfers to Luxembourg.

Some 40 tax inspectors and finance experts from the state prosecutor's offices in Frankfurt and Dusseldorf have been searching the bank's buildings in the two cities since 11 January.

They are investigating suspicions that the bank helped clients to switch undeclared funds to its Luxembourg subsidiary, so that they could avoid taxes on interest income.

A spokesman for the Dusseldorf state prosecutor's office said that the results of the searches so far had strengthened the suspicions of wrongdoing.

Dresdner Bank said that its transactions were in complete accord with German tax regulations and took place thousands of times every day.

Accusing the investigators of strong-arm tactics, the bank has indicated its intention of taking its complaint to the constitutional court in Karlsruhe. An initial protest to a lower court has already been rejected.

The bank said that employees had been threatened with arrest if they did not co-operate with the investigators and that all the mail from Luxembourg to Dresdner's main Dusseldorf office between 13 and 20 January had been unlawfully seized and searched by the authorities.

Frankfurt banking circles described the tough action against one of the country's top financial houses as a deliberate attempt to frighten German savers into keeping their funds at home.

In particular, the action was thought to be directed at shaking savers' trust in the confidentiality of German banking subsidiaries in Luxembourg.

The introduction by Germany of a 30 per cent withholding tax on interest income in January 1993 prompted a massive outflow of funds, especially to neighbouring Luxembourg, which has no such tax. German banking subsidiaries there saw an explosion in their business.

According to the latest Bundesbank monthly report, in the period between September 1992 and March 1993, some DM53bn ( pounds 20bn) worth of German savings flooded across into Luxembourg mark funds.

This financial exodus sparked off a diplomatic row between Bonn and Luxembourg, as the German government tried to persuade its neighbour to introduce a withholding tax.

Bankers believe that the German government's lack of success through diplomatic channels has now encouraged the authorities to adopt other methods.

PROMOTED VIDEO
Voices
The Ukip leader has consistently refused to be drawn on where he would mount an attempt to secure a parliamentary seat
voicesNigel Farage: Those who predicted we would lose momentum heading into the 2015 election are going to have to think again
Arts and Entertainment
Cara Delevingne made her acting debut in Anna Karenina in 2012
film Cara Delevingne 'in talks' to star in Zoolander sequel
News
i100
Life and Style
life
News
Melissa and Joan Rivers together at an NBC event in May 2014
peopleDaughter Melissa thanks fans for 'outpouring of support'
Life and Style
tech
News
ebooksAn evocation of the conflict through the eyes of those who lived through it
Life and Style
One in six drivers cannot identify a single one of the main components found under the bonnet of an average car
motoringOne in six drivers can't carry out basic under-bonnet checks
News
i100
Voices
Pupils educated at schools like Eton (pictured) are far more likely to succeed in politics and the judiciary, the report found
voices
News
peopleWrestling veteran drifting in and out of consciousness
Arts and Entertainment
Shady character: Jon Hamm as sports agent JB Bernstein in Million Dollar Arm
filmReview: Jon Hamm finally finds the right role on the big screen in Million Dollar Arm
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating
and  

By clicking 'Search' you
are agreeing to our
Terms of Use.

iJobs Job Widget
iJobs Money & Business

Recruitment Consultants - Banking & Finance

£20000 - £30000 per annum + OTE £40 - £50K first year: SThree: SThree Group an...

Business Analyst,HR,Halifax,£400-450pd

£400 - £450 per day + competitive: Orgtel: My client, a leading bank, is curre...

Recruitment Consultants - IT - Trainee / Experienced

£20000 - £30000 per annum + OTE £40-50K first year: SThree: The SThree group i...

Cost Reporting-MI Packs-Edinburgh-Bank-£350/day

£300 - £350 per day + competitive: Orgtel: Cost Reporting Manager - MI Packs -...

Day In a Page

Ukraine crisis: The phoney war is over as Russian troops and armour pour across the border

The phoney war is over

Russian troops and armour pour into Ukraine
Potatoes could be off the menu as crop pests threaten UK

Potatoes could be off the menu as crop pests threaten UK

The world’s entire food system is under attack - and Britain is most at risk, according to a new study
Gangnam smile: why the Chinese are flocking to South Korea to buy a new face

Gangnam smile: why the Chinese are flocking to South Korea to buy a new face

Seoul's plastic surgery industry is booming thanks to the popularity of the K-Pop look
From Mozart to Orson Welles: Creative geniuses who peaked too soon

Creative geniuses who peaked too soon

After the death of Sandy Wilson, 90, who wrote his only hit musical in his twenties, John Walsh wonders what it's like to peak too soon and go on to live a life more ordinary
Caught in the crossfire of a cyber Cold War

Caught in the crossfire of a cyber Cold War

Fears are mounting that Vladimir Putin has instructed hackers to target banks like JP Morgan
Salomé's feminine wiles have inspired writers, painters and musicians for 2,000 years

Salomé: A head for seduction

Salomé's feminine wiles have inspired writers, painters and musicians for 2,000 years. Now audiences can meet the Biblical femme fatale in two new stage and screen projects
From Bram Stoker to Stanley Kubrick, the British Library's latest exhibition celebrates all things Gothic

British Library celebrates all things Gothic

Forthcoming exhibition Terror and Wonder: The Gothic Imagination will be the UK's largest ever celebration of Gothic literature
The Hard Rock Café's owners are embroiled in a bitter legal dispute - but is the restaurant chain worth fighting for?

Is the Hard Rock Café worth fighting for?

The restaurant chain's owners are currently embroiled in a bitter legal dispute
Caribbean cuisine is becoming increasingly popular in the UK ... and there's more to it than jerk chicken at carnival

In search of Caribbean soul food

Caribbean cuisine is becoming increasingly popular in the UK ... and there's more to it than jerk chicken at carnival
11 best face powders

11 best face powders

Sweep away shiny skin with our pick of the best pressed and loose powder bases
England vs Norway: Roy Hodgson's hands tied by exploding top flight

Roy Hodgson's hands tied by exploding top flight

Lack of Englishmen at leading Premier League clubs leaves manager hamstrung
Angel Di Maria and Cristiano Ronaldo: A tale of two Manchester United No 7s

Di Maria and Ronaldo: A tale of two Manchester United No 7s

They both inherited the iconic shirt at Old Trafford, but the £59.7m new boy is joining a club in a very different state
Israel-Gaza conflict: No victory for Israel despite weeks of death and devastation

Robert Fisk: No victory for Israel despite weeks of devastation

Palestinians have won: they are still in Gaza, and Hamas is still there
Mary Beard writes character reference for Twitter troll who called her a 'slut'

Unlikely friends: Mary Beard and the troll who called her a ‘filthy old slut’

The Cambridge University classicist even wrote the student a character reference
America’s new apartheid: Prosperous white districts are choosing to break away from black cities and go it alone

America’s new apartheid

Prosperous white districts are choosing to break away from black cities and go it alone