The former chief executive of Deutsche Post AG, Klaus Zumwinkel, was convicted of tax evasion by a German court. He was sentenced to a two-year suspended sentence and fined €1 million.
Mr. Zumwinkel, 65, admitted that he had evaded nearly €1 million ($1.3 million) in taxes by hiding money away in the tax haven, Liechtenstein.
One of Germany's most prominent businessmen, Mr. Zumwinke resigned from his position of CEO at Deutsche Post after prosecutors launched their enquiries into his affairs. He is the most prominent figure in a series of German tax investigations.
He admitted opening the Devotion Family Foundation in March 1986, for which he is named as beneficiary, for the purpose of avoiding taxes. By December 2006 the foundation held €11.8 million and prosecutors alleged Mr. Zumwinkel attempted to evade taxes on this income between 2002 and 2006.
Mr. Zumwinkel told the court that his net worth is currently about €13 million and he expects his net income in 2009 to be about €600,000. Last year, Mr. Zumwinkel paid €3.9 million in back taxes in an attempt to settle his tax debt.
The verdict completes a year of negative publicity for Mr. Zumwinkel. A former Liechtenstein justice minister said his conviction "will send a signal to tax evaders" in Germany and elsewhere.
There has been considerable controversy about the use of stolen bank data in German tax evasion cases. A German government spokesman said Germany's foreign intelligence service paid more than €4 million for the data stolen from Liechtenstein's largest bank, LGT.
The data on four DVDs contained account information of about 780 German clients, of whom 450 have been named as being suspected of tax evasion. Further investigations against approximately 220 additional account holders are ongoing.
Since the investigations started, voluntary payments of 147 million euros in back taxes and fines of an additional 18 million euros have been collected.
Currently, German investigators are following leads based on account data stolen from Liechtenstein's second largest bank. A prosecution spokesman says German courts have upheld the right of prosecutors to use evidence even if it was stolen, "so long as the theft occurred without the prior knowledge of German investigators."
