Macquarie staff and CEO in German short selling probe
28 January 2020, Written by David Simmons
Up to 60 current and former Macquarie staff including CEO Shemara Wikramanayake (pictured) have been confirmed as suspects in a German investigation into historical short-selling activities.
As reported by the ABC, the investigation revolves around a legal loophole called "cum-ex trades" where two parties claim ownership of the same shares and thus the tax rebates they were not entitled to.
German prosecutors are reportedly looking to recover billions of euros from traders and banks that allegedly profited from this practice that was outlawed in Germany in 2012.
Macquarie flagged the investigation back in September, saying at the time that the investigation would require up to 30 Macquarie staff including CEO Wikramanayake to be interviewed by German authorities.
Last week Macquarie confirmed that the number of staff to be investigated has ballooned to 60.
In September Macquarie said it was a lender to a group of independent investment funds in 2011.
"The funds were trading shares around the dividend payment dates where investors were seeking to obtain the benefit of dividend withholding tax credits," said Macquarie.
"The investors' credit claims were refused and there was no loss to the German revenue in relation to this matter."
Macquarie is not alone in this investigation, with the ABC reporting that the German prosecutors are investigating 400 suspects in total about the "cum-ex trades" scandal.
"No information of detail or particularity has been provided regarding the naming of these people other than that it relates to short selling-related activities," said Macquarie last Thursday in a statement to the ASX.
"The total amount at issue is not considered to be material and MGL has provided for the matter. We note that no current staff members have been interviewed to date."
Shares in Macquarie are down 1.97 per cent to $142.99 per share at 11.33am AEDT.
Business News Australia
Author: David Simmons