Ex-BayernLB exec behind Formula 1 deal arrested

Author thumbnail
5 Jan, 2011 Updated Wed 5 Jan 2011 15:55 CEST
image alt text

A former executive at Bavaria’s state-backed bank BayernLB was arrested on Wednesday under suspicion of fraud, tax evasion and taking bribes related to dealings with Formula 1 racing boss Bernie Ecclestone.

Prosecutors in Munich are demanding ex-BayernLB manager Gerhard Gribkowsky explain how he amassed a fortune of $50 million (€37 million) that went untaxed.

Their investigation is centred on whether he sold the bank’s Formula 1 holdings under questionable circumstances after BayernLB took control of bankrupt media mogul Leo Kirch’s stake in the popular motor sport. The bank had hoped to recoup part of a €2-billion loan Kirch owed.

Although BayernLB initially had a difficult relationship with F1 boss Bernie Ecclestone, the Bavarians eventually supported him, raising suspicions Gribkowsky was compensated for ensuring the bank’s backing. BayernLB eventually sold its Formula 1 stake to the financial investor CVC in 2006.

Gribkowsky has told the German media in the past the connection to Ecclestone was pure speculation and his fortune came from family money. He was fired from his position at BayernLB in 2008. The banker is already being investigated for bungled sale of failed Austrian banking outfit Hypo Group Alpe Adria.

However, BayernLB on Wednesday said it had no reason to believe the Formula 1 sale was not carried out properly.

The Local/DPA/mry

More

Comments

2011/01/05 15:55

Please keep comments civil, constructive and on topic – and make sure to read our terms of use before getting involved.

Please log in to leave a comment.

See Also