Formula One’s present owners, CVC Capital Partners, prospective future owners,
participants, not to mention its governing body the FIA, will all be
following events in Munich closely to see if any of the allegations made
against the man who has ruled the sport with an iron fist for the best part
of three decades stick.
With just over one year left until the Concorde Agreement – the commercial
pact which binds Formula One’s stakeholders – runs out, the state of play is
delicately balanced and Ecclestone, the kingpin, badly needs to rid himself
of a scandal which has been bubbling away in the background all year.
Gribkowsky, the former chief risk officer at state-backed BayernLB, was
arrested in January after $44 million was found in an Austrian account he
had set up, the payments having been made via mailbox companies in Mauritius
and the British Virgin Islands.
He is standing trial for tax evasion and breach of trust towards his former
employer, for whom he was selling a 47.2 per cent stake in Formula One.
Both CVC and Ecclestone initially denied any knowledge of the payments but
after Ecclestone was formally accused by the Munich state prosecutor in July
of having paid a bribe, with Ecclestone and his family trust Bambino
Holdings receiving over $65 million between them in return, he changed tack.
Ecclestone revealed to Telegraph Sport he had paid a part of the money,
with Bambino paying the rest, but claimed he was blackmailed by Gribkowsky
who had threatened to tell HMRC that he was more closely involved in Bambino
than he should have been.
This, Ecclestone said, might have prompted an investigation by HMRC which
could have taken years and cost him millions.
HMRC may yet investigate the extent of his involvement in the trust.
The deputy attorney general, Emily Thornberry, told The Sunday Telegraph
last weekend that she had raised the matter with the Attorney General’s
Office and that they were looking into it.
If the trust is found to have been a sham he could face a tax bill running
into the millions.
Ecclestone told Telegraph Sport on Tuesday that he was unworried.
“There’s not going to be an investigation,” he said. “No chance. They [HMRC]
have already looked into everything to do with the Trust and I’ve been
cleared since about 2008. This has nothing to do with the revenue.”
Ecclestone claims that the $41.4 million he received from BayernLB was signed
off by the board and was a legitimate five per cent commission on the sale
of the sport to CVC.
The $25 million Bambino received, Ecclestone claims, was to pay back a
previous loan to the sport.
Ecclestone’s lawyer, Sven Thomas, said a 200-page legal submission made ahead
of Wednesday’s testimony makes clear the payment was not a bribe.
Timeline
2005/06: Gerhard Gribkowsky, chief risk officer for Bayerische
Landesbank, oversees sale of the bank’s 48 per cent stake in SLEC, F1’s
holding company, to CVC Capital Partners.
Jan 5, 2011: Gribkowsky taken into custody on charges of corruption,
tax fraud and breach of trust after being found to have $44 million in an
Austrian account. Barbara Stockinger, a spokeswoman for the Munich state
prosecutor, confirms it is to do with the sale of BayernLB’s stake to CVC. CVC
releases a statement: “The Formula One group and Mr Ecclestone have no
knowledge of, nor any involvement in, any other payment to Dr Gribkowsky nor
to anyone connected with him.”
Feb 15: CVC launches a probe into its acquisition of F1.
April: Ecclestone travels to Munich to answer questions from the
prosecutor.
July 19: Ecclestone is formally accused, although not charged, by the
prosecutor of paying $44 million in bribes to Gribkowsky, and of receiving
in return $41.4 million in commissions from BayernLB, with his family trust
Bambino Holdings receiving a further $25 million. Gribkowksy charged with
“corruption, embezzlement and tax evasion”.
July 21: Ecclestone admits for the first time to Telegraph Sport
that he did pay the $44 million, claiming he was blackmailed by Gribkowsky
and claiming that Gribkowsky was threatening to cause trouble for him with
HMRC. He says the money he received was a commission signed off by the
BayernLB board while the $25 million to Bambino was to repay an outstanding
loan.
July 27: Ecclestone says he paid only part of the money, with the rest
coming from Bambino.
Sept 30: Ecclestone called as a witness in Gribkowsky trial to begin on
Oct 24.
Nov 5: With just days to go until Ecclestone’s court appearance, the
shadow attorney general, Emily Thornberry, reveals to The Sunday Telegraph
she has asked the Attorney General to look into the payments made by
Ecclestone and Bambino to Gribkowsky.
The Attorney General’s Office, which oversees the Serious Fraud Office,
confirms it will examine the issues she has raised.