GERMAN authorities have searched the Frankfurt offices of JP Morgan, a bank spokesperson confirmed, as long-running investigations into one of the country's biggest financial scandals affected another global lending giant.

The share-trading scandal known as "cum-ex", which has blighted German political and financial circles for several years, has cost taxpayers billions of euros, lawmakers claim.

A large number of banks have been searched by prosecutors, with raids being conducted on the German branches of Barclays, Bank of America and Morgan Stanley in recent months.

Government officials say the investigation involves some 100 banks on four continents and at least 1,000 suspects.

"We can confirm that our Frankfurt offices were visited this week. We continue to cooperate with the German authorities on their ongoing investigation," a JP Morgan spokesperson told Reuters in an emailed statement.

Bankers and investors participating in the scheme, also known as dividend stripping, would swiftly trade shares around their dividend payout day, blurring stock ownership and allowing multiple parties to falsely reclaim tax rebates on dividends.

In the first major criminal trial for the fraud, two British bankers were handed suspended jail terms, and one a €14m penalty two years ago.

Reuters

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