The Bundesbank said yesterday it would investigate the perks and freebies enjoyed by all its board members after a row involving its president and an €8,000 (£5,300) hotel bill.
The German central bank wants to establish whether any payments or gifts accepted by its board members have violated its code of ethics. It also wants to set out "concrete and transparent" criteria for what gratuities its board members are allowed to accept, to avoid a repeat of this recent embarrassing episode.
Concerns over the board's ethical standards were raised last week after it emerged that the Bundesbank's president, Ernst Welteke, and his family stayed in a luxury hotel paid for by Dresdner Bank.
Dresdner is regulated by the Bundesbank but paid for Mr Welteke, his wife, his three-year-old son, his 25-year-old son and his son's girlfriend to spend four nights in Berlin's Adlon hotel by the Brandenburg gate over the New Year in 2002. Mr Welteke was there to attend a launch party for the euro coins and notes.
The €8,000 bill racked up during his stay has provoked outrage in Germany, where the Bundesbank has traditionally been viewed as a pillar of independence, integrity and upright banking practice. Mr Welteke had defended the right for other banks to pay for him to attend their events, but last week took an indefinite leave of absence while state prosecutors looked into the matter.
The German government has taken the unusual step of getting involved, expressing disappointment that Mr Welteke has not resigned.
Juergen Stark, the vice-president of the Bundesbank, has stepped into the breach at the bank and said yesterday that the review of past payments and gifts would be conducted by a corporate ethics adviser alongside the bank's internal audit department.
A statement from the bank said: "To obtain more objectivity into the appropriateness of reimbursements, payments etc, the board decided to name an ethics adviser. Together with the internal auditor and against the backdrop of previous practice, his or her task will also include establishing concrete and transparent criteria on the basis of contracts, Bundesbank law and ethics codes."
The Bundesbank said last week that there were not sufficient grounds for the board to ask for Mr Welteke's resignation at this time, but that it would wait for the state prosecutor to finish its investigation.Reuse content