Motorsport boss Bernie Ecclestone appeared at a High Court trial in London today to deny allegations that he made a ”corrupt bargain” to stay at the top of Formula 1 racing.
Mr Ecclestone has been accused of entering into a ”corrupt agreement” with a banker to facilitate the sale of the Formula 1 group to a buyer ”chosen” by him.
A German media company says it lost out as a result of the deal and has taken legal action against Mr Ecclestone – chief executive of the Formula 1 group.
But Mr Ecclestone says Constantin Medien’s claim ”lacks any merit” and he denies any ”conspiracy”.
He told a judge today that he had paid Gerhard Gribkowsky – who had been a senior official at a German bank – £10m (€12m).
But he said he made the payment because Dr Gribkowsky insinuated that he would create difficulties with tax authorities.
“I made the payment to Dr Gribkowsky because he said he would shake me down concerning tax arrangements with our family trust ... which would have been very expensive,” Mr Ecclestone told Mr Justice Newey. “It was £10m as it happens.”
Mr Ecclestone denied giving a different version of events to journalists or changing his story and added: “Most of these journalists, as you know, really should be closely working with Jeffrey Archer.”
Philip Marshall QC, for Constantin, suggested that there was “no way” Mr Ecclestone had perceived Dr Gribkowsky as a “threat”.
“I am not sure whether it was or whether it wasn’t,” said Mr Ecclestone. “I was not prepared to take the risk.”
Mr Marshall had outlined allegations against Mr Ecclestone at the start of the trial on October 29.
He said Dr Gribkowsky ”assisted” Mr Ecclestone to facilitate the sale of the Formula 1 Group to a ”purchaser chosen by Mr Ecclestone”.
Mr Marshall suggested that ”corrupt payments” resulted in a sale of the bank’s investment in a group of companies which owned ”lucrative commercial rights” associated with Formula 1.
He said payments totalling about £27m were made to Gerhard Gribkowsky - who had been a ”senior ranking official” at a German bank – at the instigation of Mr Ecclestone.
Mr Marshall said a ”corrupt arrangement” was entered into between Mr Ecclestone and Dr Gribkowsky in 2005.
He said Mr Ecclestone benefited financially and the deal allowed Mr Ecclestone to retain a ”position with Formula 1 going forward”.
There had been a ”real risk” of Mr Ecclestone’s removal from his position in the Formula 1 Group, he added.
Mr Marshall said the German bank sold its ”holding” in the Formula 1 Group to a private equity group called CVC.
He said Mr Ecclestone thought CVC would support his ”continuing role as chief executive” of operating companies in the Formula 1 Group.
Mr Marshall said Constantin had investment rights in the Formula 1 Group and was entitled to proceeds of any sale.
He said the bank’s investment was sold ”without the normal and proper process” and Constantin lost out.
Mr Marshall said Dr Gribkowsky was given a jail term of more than eight years after being convicted of corruption at a trial in Munich last year.
Lawyers representing Mr Ecclestone have outlined their case to the judge in written arguments.
”This claim lacks any merit,” said Robert Miles QC. ”In short, this is an artificial, manufactured complaint.”
He added: ”The claim fails on each of its elements: there was no conspiracy, there was no intent to injure Constantin ... Constantin has suffered no loss.”
Mr Miles said in 2006 it had been arranged that Dr Gribkowsky would be given a ”consultancy package” and Mr Ecclestone received ”tax threats”.
”It was arranged that Dr Gribkowsky would be given a pay-off by way of consultancy package as he was requesting,” said Mr Miles.
”Mr Ecclestone agreed to a pay-off because of the tax threats and insinuations which he had received from Dr Gribkowsky.”
The trial in London continues and is expected to last several weeks.