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Tax-Evasion Indictment against Ex-Economics Ministers, Flick Boss

May 23, 1985

BONN, West Germany (AP) _ Two former economic ministers and the former manager of the giant Flick holding company have been indicted on additional charges in connection with an influence-peddling scandal, the Bonn state court said Thursday.

The indictment charges former ministers Otto Lambsdorff and Hans Friderichs and former Flick manager Eberhard von Brauchitsch with tax evasion, the court said. Brauchitsch originally was charged with bribery and Lambsdorff and Friderichs were charged with accepting bribes.

A court spokesman said a joint trial for all three will start Aug. 29.

Prosecutors allege Brauchitsch arranged payoffs for tax breaks that allegedly saved Flick at least $288 million. The scheme allegedly was designed to protect Flick gains from the sale of a large block of Daimler-Benz automotive stocks in the mid-1970s.

The company received the tax breaks from the Bonn government in the 1970s, when Social Democratic Chancellor Helmut Schmidt was in charge and Friderichs and Lambsdorff headed the Economics Ministry.

The joint trial originally was scheduled to begin Jan. 10, but was postponed pending a formal decision on a tax-evasion indictment. That charge now will be added to the original charges.

Lambsdorff resigned as economics minister in June 1984 after the Bonn state court announced he would be charged with taking $45,000 from Flick in the late 1970s.

Friderichs, Lambsdorff’s predecessor as West German economics minister and later chairman of Dresdner Bank, the country’s second largest, originally was charged with accepting $125,000 for allegedly sanctioning the Flick tax breaks. He resigned from Dresdner Bank on Jan. 29 to prepare himself for the case.

Brauchitsch originally was indicted on bribery charges.

All three men have denied any wrongdoing.

The Flick scandal has shaken all parties in the federal Parliament except the leftist Greens party, formed in the early 1980s. A series of top West German politicians were called in to testify.

The scandal forced the resignation of Parliament President Rainer Barzel last October.Barzel has not been charged with any wrongdoing, but stepped down under what he called ″unbearable pressure″ from allegations that he received Flick money through a Frankfurt law firm before he became Parliament president.

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