Ex-banker put on Interpol most wanted list in Cum-Ex tax probe

Former investment banker Paul Mora is the first Cum-Ex suspect placed on Interpol’s public list of most-wanted suspects as Germany launched an international search for him in an escalation of its vast tax-evasion probe.

The Interpol Red Notice was issued after German judges last month announced an arrest warrant for the 53-year-old, who lives in his native New Zealand. He told a Wiesbaden court last year that he would skip his tax fraud trial because of New Zealand’s low COVID-19 infection rate and argued that he wouldn’t get a fair hearing in Germany.

The development comes as countries around Europe step up their investigations into Cum-Ex trades, which lawmakers say cost governments billions in lost revenue. Germany, Denmark and Belgium are all trying to extradite former hedge-fund employees as part of probes into the controversial practice.

“Mora is suspected of having played a decisive role in the development and planning of cum-ex deals,” according to a German Federal Police poster that can be downloaded on its website. “He is presumed to be staying abroad.”

Cum-Ex trades, named for the Latin term for “With-Without,” took advantage of tax laws in various European countries that lead to multiple refunds tax-refund claims on a dividend levy that was paid only once. German lawmakers say the practice cost the government at least 10 billion euros ($12.1 billion) in lost revenue.

Mora is among six people charged by Frankfurt prosecutors in 2017 over the controversial tax trades at UniCredit SpA’s HVB unit. Mora’s attorneys said he’s kept authorities informed of his whereabouts.

Guenter Schiffmann/Bloomberg

“He is not a ‘fugitive’ and these public steps are therefore wholly unnecessary,” his lawyers said in an emailed statement. Mora denies wrongdoing, and “reserves his full rights as a New Zealand citizen to remain in his home country.”

While Germany and New Zealand don’t have an extradition treaty, an Interpol Red Notice would restrict Mora’s ability to travel outside his home country.

“An Interpol listing means that the wanted person basically can’t travel anymore,” said Suzan Huettemann, a professor of criminal law at Mannheim University in Germany. “Whenever he enters another country, the search pops up and he faces the risk of being arrested.”

And the lack of a treaty doesn’t mean that extradition is impossible. “It’s just more difficult, as a rule, to get that person extradited,” Huettemann said.

Prosecutors in at least five German cities are looking into the controversial trades and are targeting numerous financial institutions. Cologne is leading the largest probe.

An employee at London hedge fund Duet Group faces a decision later Tuesday on whether he will be extradited to Germany as part of the Cologne probe.

Mora and two co-workers in London set up the trades at the investment-bank unit, according to the charges. The indictment targets those three and two Germans who also worked at HVB. All have left the bank.

Hanno Berger, once Germany’s most profitable tax lawyer, has also been charged in that case. He also faces a second indictment which Cologne prosecutors filed last year. Berger has consistently denied any wrongdoing.

Mora worked for some of the biggest banks in the world during the 2000s, including Credit Suisse Group AG and Merrill Lynch & Co., according to the U.K. Financial Conduct Authority. He joined HVB in 2004, which became a subsidiary of Milan-based UniCredit soon after.

— With assistance from Donal Griffin