Bernie indicted

[vintly]

Well well, be fun to see how this pans out. I hope he gets away with it. Not sure he will though, considering what he said according to the last line in the report...

Link and full transcript below:

http://www.bbc.co.uk/news/world-europe-23344423

From the BBC website:

Formula 1 boss Ecclestone indicted on bribery charge

German prosecutors have indicted Formula 1 boss Bernie Ecclestone on a bribery charge.

The charge relates to a $44m (£29m) payment to a German banker, Gerhard Gribkowsky of Bayern Landesbank. It was linked to the sale of a stake in F1.

Mr Ecclestone said he had paid Mr Gribkowsky to avoid a UK tax inquiry into the sale of Formula 1 in 2006, but denied the payments were bribes.

Mr Gribkowsky was sentenced to eight-and-a-half years in jail in Munich.

Speaking to the Financial Times on Wednesday, Mr Ecclestone said: "I have just spoken to my lawyers and they have received an indictment. It's being translated into English."

Asked how he responded to the indictment, he said: "We are defending it properly. It will be an interesting case. It's a pity it's happened."

Mr Ecclestone said it was "inevitable" that the indictment had been served. "If someone wants to sue you, they can do it and you have to defend it," he said.

In 2006, Gribkowsky was in charge of managing the sale of regional bank BayernLB's 48% stake in Formula 1 to private equity firm CVC Capital Partners, which meant the firm owned most of the sport.

CVC has since reduced its stake in a series of deals.

In evidence to a Munich court in June last year, Gribkowsky admitted that prosecution claims he had corruptly received $41.4m (£26.6m) in bank commissions, and a large payment via a family trust from Mr Ecclestone, were "essentially true".

In his testimony, Mr Ecclestone said he had been worried that if he had not paid the money, Gribkowsky would have alerted the UK tax authorities to "things" that might have led to a tax inquiry.

"The only alternative was that the British tax authorities followed a case that would have been very expensive for me," said Mr Ecclestone at the time.

"The tax risk would have exceeded £2bn. I paid him to keep calm and not to do silly things."

[cosworth151]

This is no surprise. It's been coming for some time. Now, we'll see how it pans outs.

Maybe Ron Howard's Rush will be followed by another new F1 film:

Roger Corman presents Bernie Behind Bars!

[Scott]

Geeez, the arrogance, eh?  Well, since I don't see anyone in the wings with the ability to take over Bernie's job, and I don't really want bankers running F1, I kinda hope he gets off too...but you're right Vintly, that last line won't really make a fan out of a judge or jury.

[Jericoke]

Geeez, the arrogance, eh?  Well, since I don't see anyone in the wings with the ability to take over Bernie's job, and I don't really want bankers running F1, I kinda hope he gets off too...but you're right Vintly, that last line won't really make a fan out of a judge or jury.

True... except it would be a GERMAN judge or jury.  Do they legally care if a Briton tries to rip off Britain?

What is the state of affairs between Germans and Brits these days?

[Scott]

I don't think they would give a hoot about the British tax money, but I think they would look at it as more of an indication to his general character and truthfulness.

[lkjohnson1950]

Frankly, I hope Bernie ends up behind bars. It's time someone else had a crack at F1, hopefully someone more interested in the sport and less in the cash. Maybe it would prod the teams into taking some action of their own.

[Jericoke]

Frankly, I hope Bernie ends up behind bars. It's time someone else had a crack at F1, hopefully someone more interested in the sport and less in the cash. Maybe it would prod the teams into taking some action of their own.

I'd be careful what you wish for.

It's not a given that Grand Prix Racing would survive without Bernie.  He's woven a very delicate web.  He's done it on purpose so that a)  no one can just take it from him and b)  that's his hobby.

Hopefully the teams can take direct control of the sport, but when teams tried to take direct control of IndyCar, it didn't work out well.

I don't know how European sports are run, but most American sports now have 'commissioners' who are hired by the teams, but hold absolute power over the sport and the teams.  If Bernie is replaced, I think they need someone who is installed by the teams, but does represent the teams.

[lkjohnson1950]

I think F1 is too well established to just disappear. Probably the worst that would happen is that it would turn into some sort of semi- spec series like Indycar. Bernie certainly built F1 into what it is, but he is short sighted in several areas; the internet, support for the circuits, particularly the classics, support for the newer teams, too much support for Ferrari. There is room for improvement, but Bernie is highly resistant to change.

[Jericoke]

I think F1 is too well established to just disappear. Probably the worst that would happen is that it would turn into some sort of semi- spec series like Indycar. Bernie certainly built F1 into what it is, but he is short sighted in several areas; the internet, support for the circuits, particularly the classics, support for the newer teams, too much support for Ferrari. There is room for improvement, but Bernie is highly resistant to change.

I wouldn't argue that F1 is 'perfect', but I suspect that's part of the plan.  As long as they're on top, having room to perfect the sport just means they can keep on top if anything challenges them.

As for being too 'well established' to disappear... I hate to harp on it, but the Indy500 was very recently the biggest race in the world.  Now it's just another footnote on Sportscenter.

If Ferrari and McLaren decide at any point that F1 isn't worth it, they will pull out and form their own series.  I don't see how F1 can survive without those two.  (Which is why Ferrari gets preferential treatment, of course)

[F1fanaticBD]

There is certainly some sudden surge of interest from regarding the survival of Motorsports, because out of the blue he decides to waive racing fee for this years German grand prix, which is unusual given the history of this man, and then he says he is interested to buy out the circuit for its future survival, which he would be deciding withing few months. When you are on the verge of being prosecuted in a country, which may hand him jail sentence, a sudden gesture of very friendly about motorsports of that country, does give me a feeling that Bernie is nervous about this court case, and he is trying to influence the influential people of the system to avoid jail time. One thing is for sure, Bernie will surely play the hard ball and as he said it will be really interesting to see how things unfold..

[Scott]

There is certainly some sudden surge of interest from regarding the survival of Motorsports, because out of the blue he decides to waive racing fee for this years German grand prix, which is unusual given the history of this man, and then he says he is interested to buy out the circuit for its future survival, which he would be deciding withing few months. When you are on the verge of being prosecuted in a country, which may hand him jail sentence, a sudden gesture of very friendly about motorsports of that country, does give me a feeling that Bernie is nervous about this court case, and he is trying to influence the influential people of the system to avoid jail time. One thing is for sure, Bernie will surely play the hard ball and as he said it will be really interesting to see how things unfold..

No no, deep dwn Bernie's really a nice guy, looking out for everyone.   

Unless there is a huge F1 fan in the German court that is indicting him, I can't see Bernie's 'gesture' having any effect on the proceedings.  Whatever happens, German progressive sentencing guidlines will probably mean Bernie is restricted to his cottage in Gstaad Monday to Thursday and still allowed to go to the races.

[lkjohnson1950]

Yje general feeling around the web is if Bernie is convicted, CVC will ask (force?) him to step down for PR reasons. An investment company can't be doing business with a man convicted of bribery. Bad for investor confidence.

[Jericoke]

Yje general feeling around the web is if Bernie is convicted, CVC will ask (force?) him to step down for PR reasons. An investment company can't be doing business with a man convicted of bribery. Bad for investor confidence.

Do you think he'd find a way to keep pulling the strings behind the scenes?

If so, I think he'd happily do it.  I don't think he needs to be the 'face' of FOM

[Alianora La Canta]

I believe CVC will appoint a successor to Bernie, who technically is a CVC employee at this point (if a rather powerful one). They should have enough knowledge to give whoever takes the reins a fighting chance. It's unlikely to be a banker, for those who worry - from what I've heard, the likely candidates are the people who are currently Bernie's right-hand men and women (because they know the details of how the empire works) and a handful of bosses of large retail companies (because they have the marketing and customer knowledge to put F1 in the 21st century, and because they know about stock markets). I reckon it'll be one of each category, to be made co-bosses of F1 (because the job is really too big for one person), and that they'll do a moderately successful job. They'll make less money than Bernie did in his career, but that's not really what CVC needs. What it needs is for the right amount to be invested in the right places, and enough profit back so it can provide a "blue chip" investment for them, rather than the current moderately-high but unstable earner.

[lkjohnson1950]

I think CVC's primary goal is to make F1 look stable enough that they can float their stock offering and gradually sell off the company at a substantial profit. Giving the appearance of a sound investment is why Bernie would have to go. What a lot of people wonder about is how much of CVC does Bernie control, and can he in fact veto a decision of their board?