Morgan Stanley German Offices Raided in Search of Tax Fraud Evidence
More financial giant debacles..!
More financial giant debacles! It is being reported that German authorities have raided the country’s Morgan Stanley offices as part of a euro tax fraud investigation totaling a couple of billions.
Cologne prosecutors have confirmed they searched the Frankfurt branch of the U.S. bank in connection with “cum-ex transactions.”
Morgan Stanely confirmed to Germany’s DPA news agency that search warrants were carried out and they added that "the investigation relates to past activity and we continue to cooperate with the German authorities.”
Nearly 75 investigators from various officiating branches in North Rhine-Westphalia and Hesse were involved in the raids involving the private homes of two suspects that were searched for “relevant” communications.
If you’re like me, you’re wondering what the hell a “cum-ex” scheme is. Well, it consists of quickly buying and selling shares around the stock’s dividend payment date so tax authorities can no longer identify the true owner of the stock. Kinda smart if you ask me as the process makes it possible to claim the same tax credit on the profits attached to the dividend several times.
According to Germany’s Finance Ministry, the total amount of taxes evaded by the Morgan Stanley branch adds up to nearly €5.5 Billion (nearly 5.7 Billion USD).