Could this woman be dangerous for Scholz?

Cum-ex Prosecutor Anne Brorhilker quit her job unexpectedly this week. Some say that she was frustrated in her attempts to investigate the chancellor.

Apr 25, 2024

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Now to the article…

Germany’s most famous prosecutor quit her job in a blaze of fury this week.

Until this week Anne Brorhilker, 50, was chief prosecutor in Cologne and the woman responsible for unearthing what is commonly known as “the biggest tax fraud in German history.”

But, in a bombshell TV interview, she said that she was fed up with how easy it was for the rich to get away with their crimes and announced that she had decided to work for an obscure NGO called Finanzwende instead.

“We hang the little guys and the big ones go free,” she stated, bluntly.

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For over a decade, Brorhilker has been investigating the impenetrable world of cum-ex trading, a scheme bankers used for years to claim multiple refunds on tax that had only been paid once.

Brorhilker and her team believe that they have uncovered fraud on an almost unimaginable scale: she says that German tax offices were robbed of billions of euros via illegal cum-ex trading.

In 2022, she scored her first major success when she convinced a court in Bonn to put the man known as the “architect of cum-ex”, tax advisor Hanno Berger, behind bars for eight years.

At the moment, Brorhilker is leading an even bigger case. Christian Olearius, head of private bank MM Warburg, is on trial in Bonn on 14 counts of tax evasion. If Olearius, 81, were to be convicted it would mark a highly unusual moment: a bank boss would be put behind bars for white-collar crime carried out under his watch.

As the star prosecutor sees it, this is just the beginning. She has compared the world of cum-ex trading to a mafia in which bankers, lawyers and tax advisors conspired on a massive scale.

Cologne’s prosecution service is currently investigating 120 cases of tax fraud that involve close to 2,000 suspects. Brorhilker has said that the problem is serious enough to warrant infiltrating banks with undercover detectives.

Her investigation is so huge that a whole new courthouse has had to be built in Bonn to house the trials set to take place in the coming years.

Which all leads to the inevitable question: why did she quit at the point when the fruits of years of labour were starting to go to trial?

The most plausible explanation is that Brorhilker resigned because she became fed up with what was either political disinterest, or even active interference in her work.

In her TV interview, she said that: “I am not at all satisfied with the way financial crime is prosecuted in Germany. The perpetrators are often people with a lot of money, who are well connected and are up against a weak justice system.”

“It is not as if politicians don’t understand what went on. It should be immediately obvious that we need robust prosecution services given that we are talking about damage that stretches into the billions of euros,” she added.

According to Brorhilker, politicians have allowed themselves to be influenced by the well-financed lobbying of major financial houses. “Banks spend by far and away the most money on lobbying,” she said.

Going to work for an NGO means that she can “treat the disease rather than the symptoms,” she explained.

But, for many observers, that reasoning seems a bit implausible. Why would such an ambitious lawyer swap a job as the country’s most feared prosecutor to join a small NGO few people have ever heard of?

Something here doesn’t seem to add up. Which is why some have suggested that Brorhilker was in fact the victim of a political plot.

In this movie-script version of her resignation, Brorhilker actually wanted to investigate none other than Olaf Scholz on suspicion of political interference. But she was prevented from doing so by her boss at the justice ministry in North Rhine Westphalia, Green party politician Benjamin Limbach.

Her shock resignation shows that “Justice Minister Limbach tried to put a spoke into her wheel because she had her eyes on the Chancellor in connection with MM Warburg,” claimed Fabio De Masi, a member of the left-wing BSW party who is acknowledged as an expert on financial corruption.

What we know is that Brorhilker did open a file on Scholz after he met with MM Warburg boss Olearius on several occasions in 2016. Scholz was mayor of Hamburg at the time and the city tax authority was considering whether to demand €50 million back from MM Warburg for tax refunds it acquired via cum-ex schemes. Shortly after those meetings, the tax authority dropped its demand.

Just a coincidence? That is what Scholz would have us believe.

Brorhilker seemed less convinced.

In a note attached to Scholz’ file, she stated that his explanation contained “inconsistencies” and that she had reason to believe he had taken “an active role” on behalf of the bank. But the note also stated that the prosecution service wouldn’t pursue Scholz because the time needed to gather evidence would have been “unacceptable” given his office.

Did someone higher up the chain of command tell Brorhilker to stop investigating the chancellor out of respect for the fact that he was chancellor? That is what De Masi and others suspect. They point out that prosecutors in Germany are weisungsgebunden, i.e. they take orders from the politician who heads the justice ministry.

Asked on TV this week whether Scholz’s alleged involvement in the Warburg affair had anything to do with her decision, Brorhilker said that she “couldn’t comment due to her duty of confidentiality.”

Will leaving the state prosecution service mean that she can talk more freely in the future? Not necessarily. The duty of confidentiality applies even after prosecutors have left the state payroll. But exceptions do apply when there is a suspicion of corruption…

This is all intriguing stuff. Yet, there could be a more humdrum reason for her decision to quit - one that few people are talking about.

What if Olearius is actually acquitted? The banker’s lawyers insist that he didn’t know that the cum-ex trading happening at his bank was illegal. They have pointed out that cum-ex trading was standard practice across the banking sector - even at state-owned banks like North Rhine Westphalia’s own WestLB.

Moreover, Olearius’ defence team accuse Brorhilker’s prosecutors of waging a public campaign to discredit their client before the trial began.

“The Cologne public prosecutor's office has participated to an unprecedented extent in the public prejudgement of the accused,” argued defence lawyer Peter Gauweiler at the start of the trial.

Particularly egregious for them: back in 2020 journalists printed details from Olearius’ private diary, which was seized by Brorhilker’s team during a raid of his home. The state of North Rhine-Westphalia was recently ordered to pay the banker compensation over this leak.

Viewed from the outside, it seems unlikely that Olearius will be acquitted. At the end of last year, a judge found two other Warburg bankers guilty and took a swipe at Olearius during his ruling: “Olearius knew what he was doing,” the judge said.

If the verdict does go against the prosecution though, it will put a very different spin on Brorhilker’s surprise resignation.