The Frankfurt offices of French bank BNP Paribas have been raided by authorities over suspicions of involvement in a multibillion-euro tax fraud scheme.

According to German outlet Handelsblatt, the bank's Frankfurt offices and the private homes of suspects in Hesse, North Rhine-Westphalia and Rhineland-Palatinate were searched by around 130 public prosecutors, tax investigators and police officers. The report adds that the investigation is specifically targeting 58 suspects who are currently or previously have been employed by the bank.

The report notes that the authorities are investigating involvement with the ‘cum-ex’ tax fraud scheme which was discovered in 2017 and subsequently made public by the media in 2018. The term describes a pan-European network of banks, stock traders and lawyers which stole billions of Euros from European treasuries and would lend each other shares in large companies, so that to tax authorities there would appear to be two owners of the shares, when there was only one.

The practice, which was outlawed in 2012, cost the five hardest hit countries at least $62.9 billion, with the German treasury seeing around $36.2 billion withdrawn.

A spokesman for the Cologne public prosecutor's office told Handelsblatt: "The measures are related to the cum-ex transactions that are the subject of the proceedings and related tax evasion models and are used in particular to find relevant communication in the form of emails and other written correspondence."

BNP Paribas is yet to comment on the raids.

The news will come as a blow to France's biggest listed bank which last week received necessary regulatory approvals to complete its $16.3 billion sale of Bank of the West to Bank of Montreal. The deal was initially announced in December 2021 and will double the Canadian lender's footprint.

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