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German banker in F1 corruption scandal gets 8 year jail term

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German banker in F1 corruption scandal gets 8 year jail term
Jun 27, 2012, 11:41 PM

Gerhard Gribkowsky, the banker from Bayern LB who was once chairman of the F1 holding board, has been convicted of corruption and sentenced to eigh...

Gerhard Gribkowsky, the banker from Bayern LB who was once chairman of the F1 holding board, has been convicted of corruption and sentenced to eight and a half years in jail.

According to Reuters this evening, "Presiding judge Peter Noll convicted BayernLB's former chief risk officer Gerhard Gribkowsky of tax evasion, bribery and breach of fiduciary trust in a court in Munich.

"Noll described the billionaire (Bernie) Ecclestone as the "driving force" behind the payments but said Gribkowsky, in turn, had shown "high criminal energy" "

Prosecutor Christophe Rodler had summed up his case by saying that Ecclestone was "not the victim of extortion but the accomplice in an act of bribery."

Grobkowsky was charged with accepting $44 million in bribes, which revolved around the sale of F1 to CVC in 2005 and specifically to a payment made by Ecclestone. Prosecutors said that the payment related to the sale by Bayern LB to CVC of its 48% share in the F1 business in 2005, which Ecclestone wanted to happen.

Ecclestone has not been charged by the German prosecutors and has denied any wrongdoing. He has always maintained that the payment was not bribery but instead was to stop Gribkowsky from following through on a threat to make allegations to UK tax inspectors about Ecclestone's tax affairs relating to the family trust.

It is not clear tonight where the verdict leaves Ecclestone from a legal point of view in Germany as he now waits to learn whether prosecutors will mount a case against him, but he maintains that his version of the story is the truth,

"They based their decisions on what he told them. I told them the truth," Ecclestone is quoted by Reuters as saying after the Gribkowsky verdict was announced. "I think Mr Gribkowsky told them what he thought he had to tell them. I don't think I should (face further action) but you don't know, do you?"

The development comes as CVC seeks to float the F1 business on the Singapore stock exchange. The floatation won't go ahead this summer, as intended due to market turmoil, but it is ready to go and there are plans to try to get it away later this year.

CVC has cut its stake in F1 from over 60% down to around 35% with disposals recently to major blue chip investment houses in the US and Norway.

Meanwhile the German financial newspaper Handelsblatt carried a story today that internal advice within Mercedes is that it should consider withdrawing its team from F1 over this bribery scandal as it runs against the company's statutes relating to involvement with corruption.

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