German banker’s diaries add to Olaf Scholz’s political woes

Financial Times


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Cum-ex has become a full-blown political scandal since 2021, when it emerged that Hamburg authorities had failed to disclose the meetings between Scholz and Olearius. Asked in 2019 by the hard-left Die Linke party in the city state’s parliament if there were any discussions between the senate and the bank over the tax issue, and if Scholz may have been involved, the local government responded: “No”. By then, Scholz had moved on to serve as minister of finance in the past government led by Angela Merkel. He was elected chancellor in 2021. Asked about the misleading answer, Hamburg’s senate told the FT that it “did not make inaccurate statements”, arguing that the questions had a narrow focus. “Hamburg’s government never provided a convincing explanation for the wrong answer,” said Fabio De Masi, a former Die Linke MP and anti-corruption campaigner. “All boundaries have been breached in this case,” De Masi told the FT, adding that “no citizen is entitled to haggle about his tax bill with politicians, let alone if it is about the loot from a tax fraud”. The banker’s diaries outline that even the tax official who was in charge of the matter recommended the bank “seek political support” in the summer of 2016. Olearius also describes how a former senior Hamburg politician and Social Democrat, who had become paid adviser for Warburg, reached out to Scholz ahead of the banker’s meetings with the mayor. According to the diaries, the adviser then told Olearius that “[Scholz] is looking into the matter”. After the tax decision in 2016, the adviser told Olearius that he was partly responsible for the positive turn. In 2017, Hamburg indicated it was willing to waive another €57mn tax claim against Warburg. That was prevented, at the last minute, by a rare intervention by the finance ministry in Berlin. The federal government later also shot down a deal between Hamburg’s tax authority and Warburg that would have reduced its total tax bill by €124mn. Over several years, Hamburg’s tax authority was “suspiciously willing to factor in MM Warburg’s interests in its decision making”, Cologne criminal prosecutors alleged in separate documents seen by the FT. They also point out that Olearius listed several individuals in handwritten notes who needed to be thanked after the decision. That list included Scholz, plus a tick behind his name.