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Grasser sues former tax advisor

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Grasser sues former tax advisor
Karl-Heinz Grasser. Photo: APA
11:18 CEST+02:00
Former finance minister Karl-Heinz Grasser is suing his former tax advisor, saying he gave him bad advice. A court hearing next week into his unpaid taxes has been postponed due to illness.

Grasser was due to be questioned on Monday at the Commercial Court in Vienna, and may face criminal proceedings. However he has fallen ill whilst abroad and the hearing has been postponed. 

Grasser denies any accusations of wrongdoing, saying that he only did what his tax advisor told him to do.

His advisor, Peter Haunold, was also due in court to give evidence about his involvement in Grasser’s affairs. Haunold also denies any wrongdoing.

He and his accounting firm Deloitte said that Grasser had departed from their original proposals to establish a trust.

Grasser has also been named in a number of corruption cases, including the allegation that he embezzled funds in the course of privatizing 60,000 state-owned flats (run by the Buwog housing company) in 2003-04.

This is not the first time that the former minister is in trouble over unpaid taxes. In 2011, reports said that Grasser placed €18,000 ($24,512) in a share depot in Canada and did not pay tax on it between 2002 and 2008.

In 2010, with other finance inquiries closing in on him, he finally reported the matter to the Austrian tax authorities himself. Under Austrian law this cleared him of penalties, which caused great outrage at the time.

Moreover Grasser owed the huge sum of €5.4 million in back-taxes between 2003 and 2010.

At question were his fees as a consultant to the wealthy Meinl consortium (amounting to €9 million), and a half-million euro sum invested by him.

Grasser's critics allege he dodged taxes by transferring money to Liechtenstein, Cyprus and elsewhere.

Grasser says the half-million belonged to his mother-in-law, and denies wrongdoing in any of the cases.

The banker Julius Meinl V and Grasser’s wife, Fiona Pacifico Griffini-Grasser, were both expected to be called as witnesses to the court hearing, as well as employees of Meinl Bank.

Meinl V, the head of one of Austria's most famous business dynasties, was alleged to have illegally manipulated the share price of his Jersey-based investment fund Meinl European Land, with a complicated "buy-back" scheme – a claim he vehemently denies.

Grasser's wife Fiona is heir to the Swarovski crystal fortune. Photo: APA

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