04 Nov 2021

CumEx media reports

Investec wishes to formally respond to the recent media coverage pertaining to its alleged involvement in CumEx transactions in Germany.


In August 2018, Investec Bank plc was notified by the Office of the Public Prosecutor in Cologne (CPO), Germany, that it and certain of its current and former employees may be involved in possible charges relating to historical involvement in German dividend tax arbitrage transactions (known as CumEx transactions); specifically the aspect relating to alleged multiple reclaims of tax withheld on a single dividend payment (“double dipping”). This investigation was focused on certain funding transactions concluded by Investec Bank plc’s Irish branch.

We understand that more than 1000 people across 100 institutions worldwide are being investigated by the CPO.

To date neither Investec nor any of its staff, past or present, have been charged, indicted, or subpoenaed by the CPO.

Investec’s response 

On being informed in August 2018 of the investigation by the CPO, the Investec board immediately formed a sub-committee to oversee all aspects of this matter. This board subcommittee is chaired by the Investec Bank plc Chairman Brian Stevenson to ensure it receives the attention it requires at the most senior levels of the organisation.

In 2019, Investec conducted an  internal review into these relevant activities, and further instructed leading independent UK attorneys MacFarlanes LLP to review the governance processes around the CumEx matter.

The relevant trades were found to have been conducted within approved credit, liquidity, operational and market risk limits. These limits specifically restricted exposures to any one client to fully secured short term lending of €500m. Investec did not carry out tax reclaim services.

The board sub-committee meets regularly to monitor any developments around the matter. It reports to the relevant boards and, where appropriate, makes recommendations to board committees. 

Certain internal actions have been taken following these investigations, including consideration of relevant regulatory rules and guidelines. In particular, any weaknesses considered in our governance and risk management structures and processes have been addressed. 

The Investec board is satisfied that all its disclosures, including within the audited financial statements, have been timeous and are appropriate and accurate.


Our regulators in both the UK and SA have been kept informed, in a timely manner, of any developments in this matter. 

This matter was first disclosed in our 2019 Annual Report and has been reported in each Annual Report since then. The disclosure is also included in any other public documents where required, such as debt raising prospectuses.

In the financial results for the year ended 31 March 2020, we announced that costs of £41m in relation to the restructure of the Irish branch had been recognised. This was in pursuance of the simplification and focus element of our strategy, which aimed to exit certain businesses that were sub-scale or whose risk profiles were deemed to be incompatible with the risk appetite of the business going forward. It was on this basis that the prime brokerage business in the Irish branch was exited in February 2019.

We took a view then that we should provide for a potential outcome whereby financial outflows may arise as a result of adverse findings in relation to our Irish branch prime broking activities in support of certain clients. This provision formed part of the costs of the restructure noted above. This provision is regularly reviewed and we believe it remains adequate.

Investec’s position

We continue to cooperate with the investigation by the CPO, and look forward to the conclusion of this matter. 

Given that we are dealing with an ongoing investigation, we cannot comment further in public on the detail of the allegations surrounding this matter.

Investec has always believed that the alleged “double dipping” is wrong, and it had and has a clearly defined policy against aiding and facilitating this practice. This practice was and is inconsistent with our stated values that include cast-iron integrity. Disciplinary actions will be taken against those who may be found to have acted illegally or unethically when this matter is finally concluded.