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JANUARY 6, 2011

Gribbowsky probed over kickback following F1 sale

German bank executive Gerhard Gribbowsky has been arrested for allegedly accepting a $US50m kickback from the sale of a large stake in the holding company of F1's commercial rights.

Gribbowsky, formerly the risk manager of public bank BayernLB, who became chairman of F1 rights holding company SLEC before it was sold to CVC, is being held on charges of corruption, tax fraud and breach of trust toward his former employer.

German prosecutors allege that Gribbowsky led the bank to sell the stake "without evaluation of its current value" which, in turn, earned him "two consultancy contracts worth $50m." The money is said to have been paid to companies in Austria set up for the purpose. Claims in the German media suggest that the money was sourced from firms based in Mauritius and the Caribbean. A prosecution statement also alleges that Gribkowsky failed to pay taxes on the additional income.

CVC bought a 25% stake from Bernie Ecclestone as well as BayernLB's stake in 2006, thereby becoming F1's majority shareholder. The involvement of three German occurred when Kirch Group, to whom Ecclestone had sold a majority stake, went into liquidation, leaving the banks controlling the F1 assets.

The current F1 rights holder, CVC, has issued the following statement: "CVC confirms that it has no knowledge of, nor any involvement in, any payment to Mr Gribkowsky or anyone connected with him in relation to CVC's acquisition of Formula One."