The ‘Cum-Ex’ Tax Dodge That Is Haunting Global Banks: QuickTake

The investment seemed virtually risk-free, guaranteeing hefty returns after only a short period of trading. By exploiting how Germany once taxed dividend payments, dozens of bankers, brokers and lawyers helped investors snatch billions of euros from the national treasury. A decade later prosecutors won their first convictions for tax crimes. By late 2022, some 1,600 people were facing investigation in Germany alone in what’s come to be called the Cum-Ex affair.

1. What’s a cum-ex trade?

The trades exploited an interpretation of the tax code that appeared, at the time, to let multiple people claim ownership of the same stock ...