Prosecutors and tax police raided the offices of Deutsche Bank Wednesday in a probe dating back to 2010, and "in connection with this, two management board members Jürgen Fitschen and Stefan Krause are also being investigated," Deutsche Bank said in a statement.
The probe at the bank's headquarters in Frankfurt includes 25 employees.
The bank's workers are suspected of serious tax fraud, money laundering, and obstructing justice in connection with the trade in European Union CO2 emissions certificates, Frankfurt state prosecutors said on Wednesday. Arrest warrants have already been issued for five of them.
Investigators also searched several homes and offices across Germany as part of the same operation, including some in Berlin and Düsseldorf. The probe - into the suspected evasion of valued added tax (VAT) on emissions trading - has been running since the spring of 2010.
Deutsche Bank Frankfurt offices were already raided then, but investigators believe that evidence may have been hidden from them, they said Wednesday. Deutsche Bank released a statement saying the bank will cooperate fully with authorities.
A Frankfurt court convicted six executives of other firms of tax fraud as part of the same operation last year. They had confessed to evading at least €230 million of VAT in the Europe-wide trade in CO2 emission certificates.
The company managers had bought the certificates VAT-free outside Germany, sold them on cheaply - sometimes to Deutsche Bank - and claimed the VAT back from the tax office.
The EU emissions certificate trade system allows certain companies to release a certain amount of carbon dioxide into the atmosphere. If a given firm releases less, it is allowed to sell the surplus on in the form of a certificate.
Fitschen and Krause, who is the bank's finance chief, are under investigation because they signed off the bank's 2009 VAT declaration, the bank explained.
"But that tax declaration has since been corrected voluntarily by the bank. Unlike the prosecutors, Deutsche Bank is of the opinion that the corrected declaration was submitted in a timely manner," it said.
"Deutsche Bank is cooperating fully with the authorities," it added.