(Bloomberg) -- The most feared woman in finance isn’t a regulator, a short-seller or a hedge fund titan. You won’t find her office in the City of London, Washington or on Wall Street. 

But her name resonates in the offices from Bank of America Corp. to Deutsche Bank AG and Morgan Stanley and scores of their global peers: Anne Brorhilker, the German prosecutor exacting justice for the multibillion-dollar Cum-Ex tax-trading scam that’s been called the biggest tax heist in history.

Brorhilker, 48, has won four convictions against bankers in the past two years in a prosecution that’s roiling global finance. Just yesterday dozens of officials descended on Morgan Stanley’s Frankfurt offices.

Add that to recent raids of Barclays Plc and BofA’s Merrill Lynch Frankfurt offices and it suggests she is tightening her focus on higher-profile banks. Neither Barclays, Morgan Stanley or BofA -- or any of their employees -- has been charged.

Brorhilker is expected to indict the first top executive in the next few months: Christian Olearius, once the head of M.M. Warburg & Co. and still a major shareholder, according to people familiar with the matter. Olearius has denied wrongdoing.

Among the other suspects her office is probing are ex-Deutsche Bank chief executive officers Anshu Jain and Josef Ackermann and former investment banking chief Garth Ritchie, as well as Macquarie Group Ltd. CEO Shemara Wikramanayake and predecessor Nicholas Moore. None have been charged.

Big Game

Brorhilker, senior prosecutor and department head in Cologne, has made it clear she’s going after top executives and that big settlements aren’t enough. She is currently examining some 1,500 people she says may have played a role in deals that mostly took place between 2006 and 2012. Overall, Cum-Ex is estimated to have cost Germany at least 10 billion euros ($10.91 billion).

She “worked painstakingly through an extremely complex scandal,” Konrad Duffy, adviser for financial crime prevention at the nongovernmental organization Finanzwende, said in an interview. Other prosecutors “might have quickly dropped the investigations against a few settlement payments from banks, but then the precise details of the financial industry’s involvement would never have come to light.”   

QuickTake: Why ‘Cum-Ex’ Tax Dodge Casts Shadow on Global Banks

This article is based on interviews with more than a dozen people involved in the Cum-Ex investigations. Most asked not to be identified because their roles in the cases don’t allow them to comment publicly. Brorhilker declined to be interviewed.

In a country where prosecutors and judges are rarely known by name, Brorhilker has become the face of the Cum-Ex probe. A small woman with long, ash-blond hair and stylish glasses, she has won the respect of many defense lawyers who have worked closely with her and call her audacious, hardworking and reliable. Some admit they underestimated her.

Overreaching?

Her critics say she has gone too far. A lawyer for M.M. Warburg, the Hamburg bank whose deals were at the center of the first Cum-Ex trials, told Germany’s top court that prosecutors were waging “an unprecedented smear campaign” against the lender.

Even those who applaud her work say Brorhilker may be overreaching, that no one can prosecute so many people and that keeping them as suspects for years can be a professional death sentence. They say it would make more sense to settle with the banks now instead of dragging the investigations out for years with unclear prospects.

Thomas Fischer, a former high court judge who is representing Warburg’s Olearius in a parliamentary inquiry into Cum-Ex, is even more critical.

“She is certainly qualified and a very diligent prosecutor, but she’s extremely opinionated,” Fischer said. “German rules of criminal procedure require that a prosecutor must approach each case unbiased. But she said publicly herself that right from the start she didn’t have even a shadow of a doubt that Cum-Ex was criminal. That doesn’t match.”

‘With-Without’

Brorhilker came to the work in 2013 more or less by accident. A colleague had reduced her hours and needed to swap cases. At the time, few outside the financial industry had ever heard of Cum-Ex, a Latin phrase that means “with-without.”

How It All Started: Employees at Dozens of Big Banks Said to Face German Probe 

In the trading strategy, shares were sold around dividend day to allow more than one investor to claim a refund on a tax that was paid only once, a ploy enabled by the way Germany collected dividend taxes. The complicated structure of the deals, with elaborate strings of short sales and derivative trades through multiple parties, made it difficult to investigate them.

Back then, it was still hotly contested whether the deals were criminal or just a clever strategy to take advantage of a badly built system. Initially Brorhilker was on her own, and Cum-Ex was just one of several files on her desk. She was confronted by an army of corporate lawyers ready to fiercely defend the trades and the people behind them.

Brorhilker has faced critics even on her turf. In 2020, her superiors rejected her plan to raid the Hamburg tax authority. A year later the search was back on, after the justice minister in her home state intervened.

Today she heads her own department, overseeing 30 prosecutors devoted to Cum-Ex. New police investigative teams have been set up. Germany even extended the prosecution period for tax crimes, giving her more time to go after the big players and hold off on settlements, at least for now. 

Music Lover

Brorhilker, who is married, doesn’t talk much about her personal life, people who know her say. She is a passionate lover of music, plays two instruments and briefly considered becoming a teacher. Her brother, Jan Brorhilker, is chief operating officer for Germany at the Big Four accounting firm Ernst & Young. Their father was a partner there. 

She turned to Jan, like their father an economist by training, when she started to look into Cum-Ex. While some of those who used the strategy claimed it merely took advantage of market inefficiencies, he told her the profit had to come from somewhere else. That could only be the tax angle, she concluded. 

Read More: The Unemployed Trader Who Became a $700 Million Cum-Ex Exile

Raised in North Rhine-Westphalia, she studied law at Bochum University and jumped right into prosecution after finishing her legal education. She is known for keeping long hours and often works even during time off at her parents’ vacation home on the North Sea, according to people close to her. Defense lawyers who have worked with Brorhilker recount calls they’ve gotten from her when she’s theoretically on holiday there. 

Her tireless labor “is what you would wish of a prosecutor,” said Stefan Kirsch, an attorney for one of two former traders convicted at the first Cum-Ex trial. The judges rewarded their cooperation by sparing them jail time, after Brorhilker argued for that.

Next Five Years

Brorhilker first got the financial world’s attention with a series of raids across Europe and in the British Virgin Islands and Cayman Islands in 2014. The moves required cooperation with law enforcement agencies in 14 countries. She monitored the activity in a war room set up by the police, studying lights on a huge screen that showed authorities simultaneously sweeping into banks and offices in London, Luxembourg and other financial hubs.

These operations increased the pressure on the Cum-Ex community and eventually helped bring a major breakthrough: cooperating witnesses. Brorhilker spent most of 2017 interviewing suspects who agreed to help her.

Read More: Bust Bank Sues Deutsche Boerse’s Clearstream Over Cum-Ex

Some who declined her invitations to talk have paid the consequences. The chief of a British hedge fund was arrested at her request in the South of France two summers ago when he tried to board a plane to London with his family after a vacation. He was brought to Germany and allowed to leave only after being questioned and posting bail. 

Brorhilker says she’s far from finished.

“We’re planning for the next five years,” she said in an interview in October with the German public broadcaster ARD. “If you are talking about 1 billion euros of tax loss, like we do in some of the cases, this needs diligent preparation.”

She has the patience. Hanno Berger, Germany’s most successful tax lawyer before he was dubbed the “mastermind of Cum-Ex,” went on trial on April 4 in Bonn. He spent almost a decade in his Swiss chalet before being extradited in February. Berger says what he did was legal.

Meanwhile, an army of bank lawyers remain on active duty, tasked with watching every move Brorhilker makes. At this point, it seems, there are few who underestimate her.

Read More

• From Star Performer to Star Witness -- A Cum-Ex Trader Cooperates
• Banker Drew Macquarie Into Cum-Ex. It Became a Costly Bargain
• Counting the Human Cost of Germany’s Massive Cum-Ex Tax Heist
• A Private Bank Survived the Nazis But Cum-Ex May Break It 
• Lawyer to the Rich Made His Own $56 Million Windfall With Cum-Ex

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