Germany’s Federal Court of Justice has upheld the prison sentence against Günter G., the former managing director of fund companies belonging to the Luxembourg-based Sheridan group. The court’s First Criminal Senate rejected his appeal as unfounded, bringing the proceedings to a final close, according to the court. The case is registered under file number 1 StR 305/26.
Together with other participants, G. established sub-funds whose shares were sold to wealthy private investors by an accomplice. He then transferred the money raised to a Maltese or Irish company under the so-called Malta or Ireland structure. The capital was also made available to several US pension funds.
In 2011, the participants used the funds to conduct cash and forward transactions involving German shares around dividend record dates. The transactions followed the Cum-Ex model, in which shares were traded with and without dividend entitlement, allegedly leading the tax authorities to reimburse capital gains tax that had not been paid.
The entities presented as short sellers—purported US pension funds—applied to Germany’s Federal Central Tax Office for refunds of capital gains tax and the solidarity surcharge totaling more than €460 million. Their applications relied on double-taxation agreements and included incorrect tax certificates.
Sources: Handelsblatt.