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Steffi Graf’s Father Goes on Trial for Tax Evasion

September 5, 1996

MANNHEIM, Germany (AP) _ Steffi Graf’s father testified today at his tax-evasion trial that his daughter was unaware of any irregularities in her finances because he was in charge of managing the millions she made playing tennis.

``My daughter had nothing to do with the situation,″ Peter Graf told the court in a lengthy statement that took 50 minutes for him to read.

A former used-car salesman, Graf is accused of evading taxes on $28 million of his daughter’s income. He faces up to 10 years in prison if convicted.

In his statement on the opening day of the trial, Graf put most of the blame on his tax adviser, who is also a defendant, and said tax authorities had led him to believe he was doing nothing illegal.

With Steffi pursuing yet another championship at the U.S. Open, her father was mobbed by reporters and photographers for 15 minutes outside the courthouse before taking the stand.

Prosecutor Gabriele Schoepf read excerpts from the 237-page indictment, which cites 11 counts of tax evasion. She said Graf was ``legally and in fact″ in control of his daughter’s income and assets.

Graf, 58, was arrested on Aug. 2, 1995 and has been held ever since in investigative custody. He is charged in the case along with tax adviser Joachim Eckardt.

Prosecutors allege that Graf and Eckardt failed to report $28 million of Steffi Graf’s winnings, bonuses and sponsorship money between 1989 and 1993, to avoid paying $13 million in taxes.

Graf said that local authorities did not question his tax practices for years, giving tacit approval to what he is now being accused of.

Had he been told already in 1991 that he was suspected of evading taxes, he would have cleared up the matter then, Graf said.

A special hearing has cleared local officials of granting the Graf family any tax favors.

Graf said he was convinced by his tax adviser that he was doing nothing wrong. ``I trusted him,″ Graf said. He also questioned whether money earned abroad should be taxed in Germany.

Much of Steffi Graf’s earnings allegedly went through letter-box companies set up by the two men in the Netherlands and in Liechtenstein.

Steffi Graf, the top-ranked woman player in the world, has said she left management of her finances to her father and his advisers to concentrate on her game. She has not been charged in the case but remains under investigation.

In recent years, Steffi tried to steer away from her father, who was dogged by an affair with a call girl and reports of alcoholism.

Under German law, Steffi Graf cannot be asked to testify against a family member. However, lawyers representing Eckardt have said they will insist she be called as a witness because the trial would not be complete without her.

Focus, a German news magazine, reported this week that the Grafs paid $13 million in back taxes recently. Prosecutors have not confirmed the report.

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