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Wednesday's court testimony from Formula One's former chairman Gerhard Gribkowsky raised more questions than answers. Gribkowsky is on trial in Munich for receiving an alleged £27.5m bribe in connection with the sale of F1 to current owner, the private equity firm CVC, in 2006. F1's boss Bernie Ecclestone has admitted to paying the money but says he did so because Gribkowsky threatened to falsely claim that he was in control of his Bambino family trust which needs to be independent from him for tax reasons. Gribkowsky's version of events is very different as he claimed in court that Ecclestone paid him the money so that he would wave through the sale of F1 to CVC. There seems to be one very big flaw with this theory.
Gribkowsky was in charge of selling the 47.2% stake in F1 owned by state-owned German bank BayernLB which employed him as chief risk officer. As Ecclestone told Pitpass' business editor Christian Sylt, "Gribkowsky was told by the BayernLB board to sell the shares. That was the instruction." Gribkowsky had a legal duty to BayernLB to sell its F1 stake to the highest bidder and, in turn, BayernLB had a legal duty to the German public to ensure that the stake was sold to the highest bidder. It has come to light during Gribkowsky's trial that although several companies wanted to buy BayernLB's F1 stake CVC was the highest bidder.
Accordingly, as Pitpass pointed out yesterday , there would have been absolutely no point in Ecclestone paying a bribe to Gribkowsky to get him to sell BayernLB's F1 stake to CVC since the bank had a legal obligation to sell it to CVC anyway as it was the highest bidder. And BayernLB couldn't hold on to the F1 shares instead of selling. BayernLB didn't voluntarily become an owner of F1 - it lent £634m ($987.5m) to German media company Kirch which used the money to buy the F1 shares and its repayment was secured on them. This meant that when Kirch went bankrupt in 2002 the shares were transferred to BayernLB which needed to sell them to make money back on its loan and avoid criticism that it should never have lent it in the first place.
The fact that Gribkowsky was obliged to sell to the highest bidder seems to blow a big hole in his explanation, particularly given that Ecclestone is renowned for being one of the toughest negotiators around. Ecclestone doesn't have a reputation for giving money away which seems to make it even less likely that he would have paid such a large amount to Gribkowsky to get him to do something that he was legally obliged to do anyway. But don't take our word for this - apparently Gribkowsky himself has said pretty much the same thing.
A report yesterday in the respected German publication Auto, Motor und Sport questioned "Why did Ecclestone pay for something that he could probably get at no cost? That is not his style. The former used car dealer usually has a nose for what a business is and isn't worth. There are only a few people who can claim that they took Ecclestone to the cleaners. Gribkowsky is one of them according to his own version of events. He himself admitted in his two-hour confession that, from today's standpoint, the commission hadn't been necessary because Ecclestone on the one hand wanted to get rid of the banks but on the other hand the state-owned bank was more than happy that with CVC it had a buyer which was ready to put so much money on the table."
It seems hard to see how one could conclude beyond reasonable doubt (which is the standard required to convict in a UK criminal case such as bribery) that Ecclestone bribed Gribkowsky to convince him to sell BayernLB's F1 shares to CVC when he had to do this anyway. The fact that Gribkowsky himself has acknowledged that the money did not need to be paid gives tremendous weight to this and seems to make his own explanation look tenuous.
Bearing this in mind, it seems hard to favour Gribkowsky's explanation even on a balance of probabilities which is the weaker standard required under civil cases. The more probable explanation may be Ecclestone's version of events that Gribkowsky threatened to claim that he was in control of Bambino. At least this has a good deal of background evidence since it was Gribkowsky who led a legal case against Bambino in 2005 and claimed that Ecclestone represented it in his position as a director of F1. Sylt sat through pretty much every hearing of that case and encountered Gribkowsky in court several times. Having heard the banks repeatedly insist that Ecclestone was a B director (nominated by Bambino) he says that it is not a stretch to imagine that Gribkowsky thought Ecclestone was in control of the trust.
If Gribkowsky was paid because he threatened Ecclestone it raises the question of why he testified on Wednesday that he received the money for waving through the sale to CVC. As Pitpass reported yesterday, blackmail may be frowned upon more than bribery and Gribkowsky has already served nearly 18 months of his sentence for that. By giving a confession which backed up the charges against him he also reduced his sentence substantially.
Yesterday Pitpass exclusively reported the statement by Ecclestone's lawyer Sven Thomas about Gribkowsky's explanation and he concluded that, given the effect it can have on reducing a sentence, it is no surprise that "in various cases in recent years third parties have been incriminated in "confessions" which later - in subsequent proceedings - prove to be groundless."
Perhaps the most intriguing thing about Gribkowsky's testimony on Wednesday is that despite talking for two hours he did not seem to refer once to Ecclestone's allegation that he was paid for threatening him. None of the reports about his testimony have referred to him mentioning Ecclestone's explanation and it makes one wonder why he didn't want to get stuck in to discussing it. The reason for this may now be consigned to history.
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