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Banker at centre of F1 corruption trial admits taking bribes

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Banker at centre of F1 corruption trial admits taking bribes
Jun 21, 2012, 11:44 AM

The banker at the centre of a corruption trial in Germany over the sale of F1 to CVC Capital Partners in 2005, has told the court for the first tim...

The banker at the centre of a corruption trial in Germany over the sale of F1 to CVC Capital Partners in 2005, has told the court for the first time that the charge that he took bribes relating to the sale is “essentially true”.

Gerhard Gribkowsky was the senior figure at Bayern LB at the time it held a stake in F1, having been left with it when its client the Kirsch Group went bust. After some legal wrangles with F1 commercial boss Bernie Ecclestone, the bank was keen to dispose of the stake and it was Gribkowsky’s job as senrior risk officer to get the best deal available.

German prosecutors charged him with corruption, alleging that he received $44 million from Ecclestone and from the Bambino Trust, which is linked to Ecclestone’s ex wife Slavica, in order to steer the sale towards CVC. He was further charged with avoiding tax by channelling the money through interests in Austria.

There have been stories emanating from Munich in the last week that Gribkowsky was “negotiating” with prosecutors to reduce his sentence and yesterday in court, he spoke for the first time in his long running trial, admitting that the prosecutors’ allegations against him were “essentially true.”

He said that Ecclestone had told him at a meeting in 2005, “the practice in F1 is that you scratch my back and I’ll scratch yours. “

He said, “It took me a long time to come to terms with what I have done and to admit even to myself, yes it was bribery and yes, I should have paid tax.”

In his evidence to the court last year, Ecclestone admitted paying the money to Gribkowsky, but denied that it was a bribe, he said that he was being “shaken down” by the banker, who threatened to make accusations to the UK Tax authorities about the Bambino Trust.

Yesterday, Ecclestone, who has not been charged by German prosecutors in the case, again denied any wrongdoing and saying that the CVC offer was the best deal on the table, so was clearly the deal Bayern LB should have taken. He reacted to Gribkowsky’s confession by suggesting that the banker was “trying to save himself”, saying anything to reduce what looks like a lengthy jail term.

“I suppose he would say that (about being bribed) so maybe he gets seven years instead of 14, “ Ecclestone told the Telegraph. “The poor guy has been banged up for 18 months. He would say anything to save himself.”

The case is due to come to a close next week . The effect these revelations might have on F1 is hard to evaluate until the court makes its next move.

CVC paid $893 million for the shares. The private equity firm company, which is hoping to float the F1 business later this year at a valuation of $9.1 billion, has denied any knowledge of payments to Gribkowsky.

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