BERLIN: German Chancellor Olaf Scholz has denied exerting influence in a multi-million euro tax fraud case against Hamburg-based Warburg Bank, in a parliamentary hearing into sprawling "Cum-Ex" trading scheme to defraud tax authorities.
While being questioned on Friday for a second time by the state parliamentary committee in Hamburg, Scholz maintained that "there was no political interference whatsoever", reports dpa news agency
The committee is to determine whether Scholz or other leading Social Democratic politicians had used their influence to help spare Warburg Bank from repaying 47 million euros ($47.2 million) in taxes.
The bank had been involved in the notorious Cum-Ex scheme, which saw traders in Europe use a legal loophole to shift shares back and forth at high speed between parties around the time dividends were paid out, in order to receive reimbursements for taxes they had not actually paid.
The Chancellor has been shadowed by the affair that dates back to his time as mayor of Hamburg.
The committee is concerned with three meetings between Scholz and the Warburg Bank's co-owners, Max Warburg and Christian Olearius, in 2016 and 2017.
Scholz admitted to the meetings during his first grilling, but stated that he could no longer remember the content of his talks, a position he maintained on Friday.
According to Olearius' testimony, after the first meetings Scholz had recommended sending a letter of defence to Hamburg's then state minister of finance Peter Tschentscher, in which the recovery of 47 million euros in wrongly refunded capital gains tax was presented as unjustified.
Tschentscher, who is now Hamburg's mayor, then forwarded the letter to the tax authorities, who decided a short time later, contrary to original plans, to allow the 47-million euros claim to be scrapped due to a statute of limitations.
Scholz said on Friday that tax fraud is not a trivial matter, and that he had always been aware of this. Therefore, "there was no preferential treatment of Warburg or Olearius", he added.
Opposition parties have criticized Scholz for his lack of transparency over the affair.
The leader of the Christian Democrats (CDU), Friedrich Merz, said it was implausible that Scholz had forgotten the content of talks given their importance and the sums of money involved.
Fellow CDU politician Richard Seelmaecker went so far as to call for Scholz's resignation, along with that of Tschentscher.
The leader of the far-right AfD party, Alice Weidel, said in a statement: "If, as Chancellor, he cannot clear up the suspicion of corruption, and could therefore be susceptible to blackmail, he is not fit for the most important political office of this country and must go."