Prosecutors in Germany yesterday agreed to settle the long-running case against the Deutsche Bank chief executive Josef Ackermann over huge bonuses paid to departing managers at the mobile telephone company Mannesmann after its €154bn takeover by Vodafone.
Mr Ackermann will pay €3.2m out of his own pocket to draw a line under the case, without admitting guilt. The former Mannesmann chief executive Klaus Esser will pay €1.5m, while four others will also make payments.
If approved by judges next week, the deal will free the embattled boss of Germany's biggest bank from spending several months in court.
Mr Ackermann, the former Mannesmann chairman Joachim Funk and two other former Mannesmann supervisory board members were being tried on criminal breach of trust charges for approving more than €57m in bonuses to Mannesmann executives after the takeover. Mr Esser and another employee were charged as accessories. All deny any wrongdoing.
The defendants were originally acquitted, but dragged into a second trial after Germany's highest court revoked the acquittals, saying the original trial in 2004 had failed to prove that the payments were in the company's interest.
Earlier this month Mr Ackermann and Mr Esser said that the bonuses served as an incentive to ensure the success of the takeover and a reward.
The level of payment for each defendant was linked to their ability to pay from earnings. Mr Ackermann was paid €11.9m by Deutsche last year, but his total earnings were between €15m and €20m as a result of his investments.
While the bonus payments at the centre of the case would not be seen as surprising in the UK they have become a cause célèbre in Germany, where such "Anglo-Saxon" pay packages are still hugely controversial. Mr Ackermann, widely respected for the way he has run Deutsche in the UK, faced repeated calls for his resignation in Germany where the payments came to symbolise corporate greed.
The prosecutor Dirk Negenborn told the court that the settlement was agreed because the case, which has dragged on for six years, had been a "considerable burden" for the defendants. He said testimonials from witnesses had not shown the case to be invalid.
Mr Funk will pay €1m, while the former supervisory board members Klaus Zwickel and Jürgen Ladberg agreed to pay €60,000 and €12,500 respectively. Dietmar Droste, a former employee, will pay €30,000. The money will be split between the state and "community purposes" which will be decided on by the court.
Deutsche Bank declined to comment yesterday.Reuse content