M. M. Warburg & CO (AG & Co.) KGaA is a German private bank, based in Hamburg. A family-owned bank, it was founded in 1798 by brothers Moses Marcus Warburg and Gerson Warburg, two members of the Warburg family. The bank was Aryanized under the Nazis. The Warburg family still owns 40 percent of the bank, continuing a more than 225-year legacy of private ownership.
History
The firm was formed in 1798 and long self-described as moneychanger (German: Geldwechsler); it changed that denomination to "bank" only in 1863.[1]: 45
Nazi era
When the Nazis came to power in Germany in 1933, Jews were persecuted, and their property began being transferred to non-Jews. In 1938, the Nazis arrested Fritz Moritz Warburg, former head of M. M. Warburg Co. and younger brother of Paul Warburg and Felix M. Warburg.[2] After being held for several months, he was released and went to Stockholm, eventually becoming a Swedish citizen.[3] The bank was Aryanized but its name remained unchanged.[4] It was transformed from a family firm to a limited company, and new managers were brought in, notably Rudolf Brinckmann and Paul Wirtz.[5]
The bank rose to become one of the most powerful investment banks in the City during the 60s, 70s, and 80s and Warburg himself one of London's most preeminent and influential financiers of the era. The London subsidiary was sold to Swiss Bank Corporation in 1995 and is today a part of UBS. Some descendants immigrated to the United States, for business reasons and to escape the persecution, and established themselves there. They include banker Paul Warburg and his nephew Eric M. Warburg, founder of Warburg Pincus.
Recent acquisitions
During recent years, the bank has grown through many acquisitions. It bought several German private banks such as Marcard, Stein & Co. in Hamburg, Carl F. Plump & CO AG in Bremen, Bankhaus Hallbaum AG in Hannover and Bankhaus Löbbecke in Berlin. Since 2009 the Schwäbische Bank AG in Stuttgart has been part of the Warburg Bank. In 2016 the former subsidiary banks Bankhaus Hallbaum, Bankhaus Löbbecke, Bankhaus Carl F. Plump & CO and Schwäbische Bank were amalgamated with M. M. Warburg & CO.
The bank has been implicated in the Cum-Ex scandal, accused of defrauding taxpayers in excess of over 50 million euro.[7] One of the leading players in cum-ex transactions, Hanno Berger, advised M. M. Warburg & CO. According to a Spiegel report published in March 2021, Warburg paid 17.5 million euros to Hanno Berger and Benjamin Frey for advice on cum-ex deals. Warburg wired the money to Sarasin Bank, which routed it to an offshore firm owned by Berger and Frey in the British Virgin Islands.[8]
At the end of 2019, Christian Olearius and Max Warburg Jr. resigned from the Supervisory Board of M.M.Warburg & CO. The tax liability from the share transactions was repaid in full in 2020, mainly from the owners' private assets.[9]
On January 12, 2022, the former managing director of a Warburg subsidiary in Luxembourg surprisingly confessed during a trial before the Bonn Regional Court ('third cum-ex criminal trial'). He is regarded as the Warburg Group's first confessed cum-ex actor.
The lawyer Gerhard Strate filed a complaint against Olaf Scholz and Peter Tschentscher in February 2022. The then mayor and now federal chancellor Scholz and the then finance senator and now mayor Tschentscher are accused of having initially waived taxes totalling 47 million euros from M. M. Warburg & Co. Strate accuses the politicians of aiding and abetting tax evasion.[10]
An investigation committee of the City of Hamburg is looking into the matter.[11]
In April 2023, the Bonn Regional Court admitted an indictment by the Cologne public prosecutor's office against Dr Christian Olearius for serious tax evasion.[12] On 24 June 2024, the trial against Dr Christian Olearius was discontinued for health reasons.[13]
Literature
Massimo Bognanni (2022): Unter den Augen des Staates. Der größte Steuerraub in der Geschichte der Bundesrepublik. dtv ISBN9783423283069
Klessmann, Eckart (2004). M. M. Warburg & CO 1798—1998: Die Geschichte des Bankhauses. Hamburg: Dölling und Galitz. ISBN3-933374-27-8.
^""aryanized" Warburg Bank Takes over Goldschmidt Firm in Hamburg". Jewish Telegraphic Agency. Retrieved 2023-02-02. The M.M. Warburg & Co., 141-year old private banking house in Hamburg, Germany, which was recently "Aryanized," but is continuing under its old name, has taken over the business of the Hamburg Jewish banking house, J. Goldschmidt & Sons, it was learned here today.
