BONN (Reuters) – A leading German banker will appear in court on Monday. He is accused of being involved in a tax fraud worth billions in which numerous German and international banks as well as hundreds of private individuals were involved.

In this system, known as “cum-ex” or “dividend stripping,” banks and investors traded shares in companies shortly before the dividend payment date, blurring ownership and allowing multiple parties to wrongfully claim tax refunds on dividends.

The legal loophole that allowed the trade to flourish between 2005 and 2012 has now been closed, but lengthy investigations have taken on enormous proportions as courts and authorities try to bring the perpetrators to justice and save the state budget by an estimated 10 billion euros ($10.66 billion).

The trial, which began in Bonn on Monday, concerns Christian Olearius, the 81-year-old former CEO and chairman of the Hamburg bank MM Warburg and the highest-ranking banker to stand trial so far. He has denied any wrongdoing but made no statement in court on Monday.

Prosecutor Stephanie Kerkering stated in court that Olearius had conspired with other people inside and outside Warburg to carry out the transactions.

The profit was “based on the fraudulent acquisition of taxpayers’ money,” she said.

The public prosecutor is demanding damages of almost 280 million euros.

Warburg declined to comment.

Earlier this year, a tax lawyer who allegedly planned the fraud was sentenced to another eight years in prison, the longest ever.

Others, including a former employee of the Warburg Group and two British bankers, were also sentenced and fined.

The case has also taken on political dimensions.

German Chancellor Olaf Scholz, a former mayor of Hamburg, was asked by MPs whether he had interfered in the tax affair on Warburg’s behalf, but he denied such allegations.

(1 US dollar = 0.9377 euros)

(Reporting by Matthias Inverardi; text by Tom Sims, editing by Friederike Heine and Bernadette Baum)