German banks have purportedly aided investors in large scale tax evasion exploiting legal ‘loopholes’, with Commerzbank playing a key role in the alleged scam. According to an investigation carried out by the journalists’ investigative association made up of Bavaria’s state TV (BR), newspaper ‘Handelsblatt, Washington Post and the investigative office ‘ProPublica’ out of new York, German banks helped investors hide millions of Euros by taking advantage of a loophole in the system. The damage caused to the German state is estimated to be €5bln in 2011. According to the research conducted, Commerzbank seems to be the focal point of the scam. One of the tricks used to hide the money involved a foreign based German business holding shares in a German group with the prior lending its shares to a German bank just before paying out dividends. The dividends would flow into the bank, which in turn paid 25% in capital taxes to the German state. However, having its head offices in Germany the bank received a discount on the aggregate sum leading to it retaining the 100% value of the dividend. Following this, the bank returned the shares to the real owner and investor withholding a 5% for ‘services’ rendered.