German Federal Court upholds prison sentence for Cum-Ex fund manager

The German Federal Court of Justice (BGH) has upheld a prison sentence of three years and nine months for a former managing director of the Luxembourg-based Sheridan Group. The conviction relates to his involvement in Cum-Ex tax fraud schemes involving international fund structures.

In 2011, these structures were used to claim more than 460 million euros in tax refunds for capital gains tax and solidarity surcharges that had not actually been paid. The court found that the individual helped develop a structure where funds were provided for Cum-Ex transactions, involving various sub-funds, Maltese and Irish fund companies, and US pension funds.

In a related development, the Higher Regional Court of Frankfurt rejected a complaint by Hanno Berger, a key figure in the Cum-Ex scandal, regarding the seizure of his pension. The court ruled that his pension could be seized down to zero euros to satisfy the recovery of criminal proceeds, citing legal provisions for intentional unlawful acts.