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Banker at centre of F1 corruption trial admits taking bribes
Posted By: James Allen  |  21 Jun 2012   |  11:44 am GMT  |  58 comments

The banker at the centre of a corruption trial in Germany over the sale of F1 to CVC Capital Partners in 2005, has told the court for the first time that the charge that he took bribes relating to the sale is “essentially true”.

Gerhard Gribkowsky was the senior figure at Bayern LB at the time it held a stake in F1, having been left with it when its client the Kirsch Group went bust. After some legal wrangles with F1 commercial boss Bernie Ecclestone, the bank was keen to dispose of the stake and it was Gribkowsky’s job as senrior risk officer to get the best deal available.

German prosecutors charged him with corruption, alleging that he received $44 million from Ecclestone and from the Bambino Trust, which is linked to Ecclestone’s ex wife Slavica, in order to steer the sale towards CVC. He was further charged with avoiding tax by channelling the money through interests in Austria.

There have been stories emanating from Munich in the last week that Gribkowsky was “negotiating” with prosecutors to reduce his sentence and yesterday in court, he spoke for the first time in his long running trial, admitting that the prosecutors’ allegations against him were “essentially true.”

He said that Ecclestone had told him at a meeting in 2005, “the practice in F1 is that you scratch my back and I’ll scratch yours. “

He said, “It took me a long time to come to terms with what I have done and to admit even to myself, yes it was bribery and yes, I should have paid tax.”

In his evidence to the court last year, Ecclestone admitted paying the money to Gribkowsky, but denied that it was a bribe, he said that he was being “shaken down” by the banker, who threatened to make accusations to the UK Tax authorities about the Bambino Trust.

Yesterday, Ecclestone, who has not been charged by German prosecutors in the case, again denied any wrongdoing and saying that the CVC offer was the best deal on the table, so was clearly the deal Bayern LB should have taken. He reacted to Gribkowsky’s confession by suggesting that the banker was “trying to save himself”, saying anything to reduce what looks like a lengthy jail term.

“I suppose he would say that (about being bribed) so maybe he gets seven years instead of 14, “ Ecclestone told the Telegraph. “The poor guy has been banged up for 18 months. He would say anything to save himself.”

The case is due to come to a close next week . The effect these revelations might have on F1 is hard to evaluate until the court makes its next move.

CVC paid $893 million for the shares. The private equity firm company, which is hoping to float the F1 business later this year at a valuation of $9.1 billion, has denied any knowledge of payments to Gribkowsky.

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It is quite heartening to read Germany will send corrupt bankers to jail…


Yes ain’t it funny how a 9.1 billion company was ‘only’ worth 1.6 only six years agos . Makes 44 million seem like small change.

What’s funny is that a certain party had/ has a bested interest in both entities.

Keen to see more news on a succession plan thanks James .


My guess is that Bernie is telling each side whatever he needs to in order to reduce the potential damage.

He tells the Germans “it was a shakedown so I wouldn’t get in trouble in UK for taxation issues”, that isnt in the Germans jurisdiction, so it saves him from getting charged for bribery in Germany.

Then to the UK taxman, he says “there’s no financial irregularities to worry about, it wasn’t really a blackmail payment, it was really a bribe in relation to the sale of F1, but I just said I was being blackmailed to get out of the bribery allegations” this makes sense to the taxation investigators [mod] and since that isn’t in their jusisdiction, they don’t bother pursuing it any further either.

By switching stories, he can easily wriggle out of any potential issues, another win for Bernie!!


Reading this is greatly disheartening and fills one with increasing pessimism about the future of Formula 1 racing. I’m thinking more and more that it would be best for the sport if the teams all got together and [mod] started a completely new series.

The FIA would run the show 100%, not just govern the rules and regulations. Making money can take a back seat (or to take this metaphor further – it can be put in the trunk) and RACING & TECH should be the primary focus.

Teams would have to reflect deeply on why they actually exist in the first place: To build race cars and race them. NOT to make money. Breaking even or turning a modest profit is all that is needed to survive. So long as you keep a large fan-base, sponsors will always be there to provide funding.


Why was this modified? There was no fowl language in it at all.


It was libellous – Mod

And its “foul” language

Fowl = wild birds



I’m going to think of this and laugh any time someone says “foul language” in the next few months.

And people will not be able to imagine what I’m laughing about…


Hardly. Oh well.

But thanks for the spell check, I realized it after I posted it and was hoping it wouldn’t be noticed. LOL.


Much safer for this guy to “admit” he took a bribe rather than admit that he was a blackmailer.


With the trial concluding and Gribkowsky giving evidence for the first time it’s patently obvious that Ecclestone was the prime mover in this. While he continues with his quasi-judicial defence via his pet web-site is he fooling anyone.

The significance of the last paragraph in this article is I suppose intended to draw our attention to the fact that while $1.7b was paid for the commercial rights in 2005/6 it’s worth $9.1b today.
And are we supposed to enquire what it was that occurred in the intervening period to take what Ecclestone frequently stated was overpriced in 2005 to a fivefold increase in value during the worst financial crisis in 100 years. Can anyone supply the answer.

Or is it that the business was seriously [mod] undervalued. That the valuation prior to that sale was of the order of $4-5b and Gribkowsky now states the bribery allegations are “essentially true”, what’s to stop a European Arrest Warrant being issued for Mr Ecclestone.


You have to remember that there was a threat in those days from GPMA – the manufacturers’ group – of a breakaway. This reduced the value of the business a lot at that time as there was a lot of uncertainty about its future


Yes quite true but the underlying issue was, no Concorde Agreement and the threat little more then an impractical negotiation tactic. So no different to today really, yet this hasn’t been reflected in the current value?

You’ll also be as aware as anyone the value of the commercial rights and how it’s calculated, suffice to say the returns on the banks 47% investment in the cash cow that is F1 make a complete nonsense of a $1.7b valuation.

Ecclestone makes the point CVC was the best offer on the table, well lets see the documentation on that. And even were that the case, given the figures what would an independent advisor have made of the decision to accept it, I suspect we may be back to that word you redacted (not that I blame you).


Yes, but no Concorde Agreement is one thing, when teams have already signed individual deals. A breakaway threat is quite another!


Funny how some people belive that F1 is clean and honest to the core and that no one gets shafted or plays games. Drivers as well as teams are in a game in which powerful interests come first and all are expendable to that end. That’s what they enjoy doing. What was that Bernie said? Something like: ‘Hitler got things done…’


Well I don’t believe everything are clean in F1. For starters I believe half of those Ferrari trophies from early 2000 were won on unfair means (FIA biased towards Ferrari, paid extra money etc), nor do I believe FIA could not find a way to fail RBR’s bendy wing in 2011.

Anything involves business and large sums of money are bound to be dirty lol, just a matter of more or less 😀


How potentially damaging is this? Could it turn into a bit of bomb?

And do CVC know something about the outcome that we don’t which could explain their recent cash in before the “KERS” hits the “Brabham BT46B”?

I´ll take copyright on that if “it” does happen 😉

JackFlash (Aust)

Ha Ha…

“before the ‘shite’ hits the ‘fan-car’..”

I like it. JF


What’s more sh**y, KERS or DRS? Judging by previous comments, I think it may be DRS.


Yes. At least KERS is deployed on track in a fair way. DRS is a one sided advantage.


It would take a huge number of top level HMRC investigators, accountants and then lawyers to dig through Bernie’s finances. It would keep them employed full time, with attendant fees and expenses for several years. I suspect that HMRC would eventually realise that it would not be cost effective to continue. Any small percentage of Bernie’s income that was traced and declared UK taxable on top of the £25M a year he already pays, would not be worthwhile pursuing.


I smell a rat…


If there’s one thing to admire about Bernie, it’s the effortless way he explains everything.

That, and it’s never his fault!


I’m afraid I’m now at the point where nothing to do with Bernie Ecclestone’s business practices surprises me anymore, and hence feel that the sooner someone else is running the show regarding F1 the better it will be for everyone. He can certainly take credit for improving F1’s global profile and profitability many times over, but his actions now seem to be doing more harm than good to the sport (witness Bahrain, for example) and in some ways come across as bordering on parasitic. No one person is bigger than the sport – not even Bernie.


James – irrespective of what happens next week is there a timeline in place for Bernie’s succession planning (assuming there is one)?

It would be interesting to know roughly when (Bernie steps down) and who (fills the vacant role).


No timeline, but there is a succession plan in place, according to share prospectus

JackFlash (Aust)

Yeah… Bernie has cloned himself like Dolly the Sheep!

Bernie has been faithfully teaching his young paduan all the ropes in a secret hideeaway in Cerne – How to be an F1 supremo – How to hide business dealings in stacked trusts and offshore corporation structures – How to jerk the media around to do your publicity bidding…. Things like that! JF


Amazing, too, that the same teams led by Montezemola and Dennis are always at the forefront while other teams can’t get a look in due to rules changes and the such. And if, by chance a team such as Brawn succeed it is short-lived.

Yes, it is a business.


Umm I’m not the first one to say it, but Ecclestone “denied that it was a bribe, he said that he was being ‘shaken down’ by the banker, who threatened to make accusations to the UK Tax authorities about the Bambino Trust”?

You don’t pay somebody $44,000,000 because they’re threatening to make accusations unless you really *do* have something to hide.


Don’t agree.

Someone can be blackmailed even when they have done nothing wrong, because too many people are suspicious and paranoid. Someone can threaten to cast you into suspicion, and that can turn into a fire that spreads, or at least foul up and destroy what you were trying to do, even if you were not trying to do anything wrong.


if you read another website/newspaper..

the idea is that it was done at a time when a delay would have mucked things up for bernie.

it’s claimed that allegations, regardless of whether it’s true or not, would have resulted in some investigation by the tax men and caused delay and what not.

whether it’s true or not and whether you believe him or not is another matter

the pimp's main prophet

Once again Bernie insults everyone’s intelligence. He might get away with it elsewhere but not in a German court. Does anyone know if it is legally possible that he still gets charged?


Moderating the comments on this one ought to keep you quite busy, James.

I’ll spare you my opinions of Ecclestone.


Good one, same here.


So Bernie denies wrongdoing but was keen for the UK tax authorities not to find out “things” that might have led to a tax inquiry.

It would appear that Bernie is avoiding tax liabilities. I guess his is the Jimmy Carr defence; “it’s not illegal” …maybe immoral, but definitely legal. I guess they think a conscience is just something that hinders poor people.


ANyone with any sense at all wants to keep the taxman out of their business, no matter how large or small! Its *never a good thing!


Small Addendum if you don’t mind.

Everyone wants to pay as little tax as possible, but wants others to pay as much as possible to ensure those “useless” government services like health care, schools, housing are there at their disposal.

But you have to admit, in case of the uber rich – it would be nice if they contributed more to the countries where they have enjoyed the opportunities. I find it sickening for example when I hear they pay a 10% tax rate.


As far as HMRC are concerned, they will want to know if Bernie had “control” over the Bambino Trust which he has always said he did not. If that was so, why did Bambino make the payment (along with Bernie) to Gribkowsky?


If it looks like a duck, and it sounds like a duck, it can still smell like a rat whether you scratch its back or not.


“He would say anything to save himself “.

Bernie certainly is an expert on that subject


Fruedian slip?


I would be surprised if after all this the Taxman in UK doesn’t start an investigation.

We are talking about £2bn tax evasion..

Bring Back Murray

Yes, but would Bernie even notice that!


To me Bernie would seem to be more of a shaker; not a shakie.


I laughed at that (because it’s true)


The whole thing stinks!
Whether you badge it up as a bribe, bung, or a shake down, $44million when smaller teams can operate for several years on that sort of money… its disgusting!

Where did Bernie get this money in the first place? From F1 over many years! [mod]


The G**** T**** R*****y???


Has nothing to do with how much the teams spend or dont. It would keep me in hamburgers for a while – is *that relevant?


these banks all need to be shut down to have any hope of saving humanity.Destroying everything on it’s path


Couldn’t agree more. As Bertold Brecht asked “if it is a bigger crime to found a bank than to rob one.”


And whatever happened to the British revenue and tax agency looking into Bambino? Was there news, conclusions? Just curious.

End of day, the man had done an awesome CEO job here at FOM. And you don’t get this result without probably bending a rule or two. And I course why not make a few pennies while at it.

Bring Back Murray

With all the money being thrown around in this sport its not surprising to hear of the odd backhander here and there

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