:00:07. > :00:15.He is the all-powerful ruler of Formula One. Formula One is Bernie
:00:16. > :00:19.Ecclestone. And Bernie Ecclestone is Formula One. Bernie Ecclestone's
:00:20. > :00:25.four decades at the top of the sport have made him super-rich. I think he
:00:26. > :00:30.couldn't have squeezed any more money out of it than he has done.
:00:31. > :00:38.He's pulled off what may be the UK's biggest personal tax dodge of all
:00:39. > :00:43.time. Two billion is a pretty substantial loss of tax. He can't
:00:44. > :00:48.receive payments from his family's offshore trusts but we show how he's
:00:49. > :00:51.got hundreds of millions. He is not someone who should be relied on to
:00:52. > :00:54.tell the truth. It should be investigated. He's been branded a
:00:55. > :00:59.liar and now he is on trial in Germany accused of paying a massive
:01:00. > :01:02.bribe. Corruption, unlawful payments, totally irregular.
:01:03. > :01:11.Absolutely unacceptable. Is this the end of the road for the King of
:01:12. > :01:31.Formula One? Did you avoid two billion in taxes?
:01:32. > :01:38.It's one of the greatest shows on earth. Formula One's mix of speed
:01:39. > :01:45.and danger is loved by millions of people around the world. It's a
:01:46. > :01:50.hugely lucrative business, generating hundreds of millions of
:01:51. > :01:54.pounds year after year. One man more than any other has
:01:55. > :02:00.driven the sport's phenomenal success. There's Bernie Ecclestone,
:02:01. > :02:04.the sdoor of -- the Tsar of Formula One. He's dominated the sport for
:02:05. > :02:08.almost 40 years. It's one of the world's top sports, fast-moving,
:02:09. > :02:16.dangerous, worldwide, global. That's down to Bernie Ecclestone.
:02:17. > :02:20.It's made him into one of the most powerful figures in world sport.
:02:21. > :02:29.Coverage of Formula One shows him with an entourage of the rich and
:02:30. > :02:33.famous. But last week he went on trial in
:02:34. > :02:41.Germany in a case that threatens to end his reign over Formula One.
:02:42. > :02:44.Bernie Ecclestone has staged races in just about every corner of the
:02:45. > :02:48.globe. But he can't have imagined that the most important contest of
:02:49. > :02:55.his life would happen here, at a Munich courthouse.
:02:56. > :03:01.He's accused of corruption, charged with paying a multi-million dollar
:03:02. > :03:10.bribe. He says he's innocent but if convicted, he could face years in
:03:11. > :03:20.jail. I'm convinced it's the biggest drama, the biggest fight for
:03:21. > :03:26.Ecclestone in his business life. That's pretty much all the Formula
:03:27. > :03:29.One footage we can show you. Bernie Ecclestone has long guarded all
:03:30. > :03:39.rights to the sport and his company doesn't want us to use any pictures.
:03:40. > :03:55.We asked to film at a Grand Prix, but were turned down. So, to give
:03:56. > :04:08.you the glamour and style you're probably expecting, we've got our
:04:09. > :04:14.very own racing car. To understand Bernie Ecclestone, you
:04:15. > :04:17.need to go back to his beginnings. A brilliant deal-maker, he made his
:04:18. > :04:24.first fortune selling second-hand cars. But he ran into legal trouble
:04:25. > :04:32.on the way. In 1971, he was taken to court for pocketing cash that should
:04:33. > :04:35.have gone to the taxman. The judge described his behaviour as
:04:36. > :04:45.altogether extraordinary. It wasn't the last time he would be criticised
:04:46. > :04:48.in court. Motor-racing was his passion. After
:04:49. > :04:51.he stopped driving himself, he bought his own Formula One team and
:04:52. > :04:59.he soon began to take control of the sport. Bernie's key vision was
:05:00. > :05:04.seeing that broadcasting was the future and that was where the money
:05:05. > :05:08.would come from. If he could control all the broadcasting rights around
:05:09. > :05:16.the world then that would give him an enormous amount of money. He
:05:17. > :05:19.drove hard bargains with TV companies and the cash started
:05:20. > :05:23.rolling in for the owners and drivers. We want to speak to the
:05:24. > :05:31.teams but all that money brings loyalty. Darragh McIntyre from BBC
:05:32. > :05:36.Panorama here looking to speak to Williams. Is that Ferrari? An update
:05:37. > :05:40.on the response from Red Bull. Everyone in the sport is dependent
:05:41. > :05:44.on Ecclestone and no one wants to talk to us.
:05:45. > :05:51.I am just wondering whether Force India will be able to put up someone
:05:52. > :05:55.to speak? In fact, we had to travel halfway
:05:56. > :06:04.around the world to find an insider to talk on the record.
:06:05. > :06:09.Eddie Irvine raced for Ferrari in the 1990s. You have no idea how
:06:10. > :06:14.difficult it's been to get someone to speak to us. He now owns an
:06:15. > :06:19.island in the Bahamas and this is his yacht club.
:06:20. > :06:23.Did Bernie Ecclestone help make you rich? For sure he did. Back in the
:06:24. > :06:27.early days it definitely needed someone to pull it together. It did
:06:28. > :06:31.need a ringmaster and it did need an owner. Bernie spotted an opportunity
:06:32. > :06:36.to wiggle his way in and basically in a way he stole the sport. He
:06:37. > :06:41.gradually put all the pieces together, you know, was the promoter
:06:42. > :06:46.of this race, owned the TV rights of that race and it just picked up
:06:47. > :06:53.crucial little jewels in the crown. Then the only person the crown would
:06:54. > :06:56.fit was him. In 1995, Irvine saw Ecclestone pull
:06:57. > :07:02.off his most significant deal yet when he got control of the lucrative
:07:03. > :07:05.TV rights to Formula One. The teams had previously held the rights.
:07:06. > :07:11.Ecclestone was their representative and they thought he was negotiating
:07:12. > :07:14.a new deal on their behalf. But Ecclestone cut a deal that meant
:07:15. > :07:18.the rights went to a company he owned instead.
:07:19. > :07:23.The teams really screwed themselves in 95. The teams were asleep and
:07:24. > :07:30.Bernie's seen the big prize and went for it and got it. Having taken the
:07:31. > :07:38.TV rights from the teams, Ecclestone then gave them to his wife Slavica
:07:39. > :07:43.through her off offshore company Petara. A generous act but one which
:07:44. > :07:50.also paved the way for a massive tax dodge. Slavica then transferred
:07:51. > :08:01.ownership to a family trust in Liechtenstein. A country well-known
:08:02. > :08:05.as a secretive tax haven. There's no question that the
:08:06. > :08:07.arrangement has been put together to create tax-planning opportunities
:08:08. > :08:16.which otherwise wouldn't be available.
:08:17. > :08:21.A few years later, one of of the family trusts called Bambino sold
:08:22. > :08:26.off a big slice of the TV rights bringing in profits of almost 2. .5
:08:27. > :08:32.billion. If Ecclestone had still owned them, he would have paid
:08:33. > :08:36.capital gains tax of up to 40%. But because they were offshore, there
:08:37. > :08:45.was no UK tax to pay, allowing his family to enjoy all that cash.
:08:46. > :08:52.Slavica's already taken out more than a billion dollars. His
:08:53. > :08:58.daughters have had millions too. Tamara Ecclestone starred in her own
:08:59. > :09:07.reality TV series. Meet Tamara Ecclestone... Modestly called
:09:08. > :09:11.Billion Dollar Girl. She's driven... Follow one of the richest women in
:09:12. > :09:18.the world. And when her sister Petra got
:09:19. > :09:21.married the bill was a staggering $12 million. Bernie Ecclestone
:09:22. > :09:25.declined to be interviewed but said the transfer of assets to his wife
:09:26. > :09:30.was lawful and not contrived or artificial. He said they were
:09:31. > :09:33.transferred to avoid inheritance tax rules which at that time acted in a
:09:34. > :09:40.way he and his wife considered to be very unfair.
:09:41. > :09:45.The family's Bambino trust still owned a minority stake in the TV
:09:46. > :09:48.rights in Formula One. But the company that owned the largest stake
:09:49. > :09:54.went bust and by 2005 the sport ended up in the hands of a German
:09:55. > :09:58.bank, BLB. Ecclestone was desperate to maintain his role at the top of
:09:59. > :10:05.the sport to stay in control, but the new owners had other ideas. The
:10:06. > :10:12.German bank wanted him gone. The bank called it the end of the Bernie
:10:13. > :10:18.Ecclestone era. Senior bank banker Gerhard
:10:19. > :10:21.Gribkowsky was in charge. Coverage of Formula One showed him and
:10:22. > :10:26.Ecclestone together at a race shortly after. Their struggle for
:10:27. > :10:32.the control of the sport would result in Gribkowsky going to jail
:10:33. > :10:36.and Ecclestone on trial for bribery. We have pieced together the story
:10:37. > :10:41.from transcripts we have obtained of interviews carried out by the German
:10:42. > :10:45.public prosecutor. Gribkowsky told him that own even though the bank
:10:46. > :10:50.held the TV rights, Ecclestone was still in the driving seat. He made
:10:51. > :10:54.it clear to me that he had full control over Formula One's assets.
:10:55. > :11:01.MrEcclestone said, I'll tell you what you really control, nothing.
:11:02. > :11:08.Ecclestone was effectively holding the bank to ransom. He held the keys
:11:09. > :11:12.to the network of complex deals that tied the sport together and he would
:11:13. > :11:18.only share them if he got his own way. He then made it clear that
:11:19. > :11:21.given this situation, there were two possibilities: Either he presented
:11:22. > :11:27.me with a buyer and I helped him get the sale through, or he would kick
:11:28. > :11:30.us out. If Gribkowsky played ball,
:11:31. > :11:36.Ecclestone promised to look after him. What MrEcclestone said to me in
:11:37. > :11:42.this meeting was that if I helped him, then literally, I will take
:11:43. > :11:48.care of you. Gribkowsky took up Ecclestone's offer. He chose a
:11:49. > :11:52.bidder, CVC Capital Partners, that had agreed to keep Ecclestone in
:11:53. > :11:57.charge. As for Ecclestone himself, well, he got paid a commission of
:11:58. > :12:05.$63 million for helping to do the deal.
:12:06. > :12:11.Why do you think Bernie Ecclestone wanted to ensure that CVC bought
:12:12. > :12:16.BLB's shares? Control. Simple as that? His fundamental aim was to
:12:17. > :12:22.ensure that the sale was to a company that was acceptable to him,
:12:23. > :12:27.a company that would enable him to run the Formula One business as he
:12:28. > :12:35.always had, with him in control. A few months later, Gribkowsky got
:12:36. > :12:45.together with Ecclestone to discuss his reward. They met at this London
:12:46. > :12:53.restaurant where it was agreed that Gribkowsky would be paid $45
:12:54. > :12:58.million. Half of the money would come from Ecclestone and half from
:12:59. > :13:01.the family's Bambino trust. He told his lawyer that he didn't want his
:13:02. > :13:13.name to appear on the transactions in any circumstances.
:13:14. > :13:18.The deal remained secret for four years until a journalist here in
:13:19. > :13:23.Munich discovered an obscure Austrian foundation owned by
:13:24. > :13:31.Gribkowsky. His hidden wealth was revealed. The foundation owned
:13:32. > :13:36.assets worth around about 25 million euro. It looked very dirty because
:13:37. > :13:43.Gribkowsky couldn't have made this money with his job. Gribkowsky
:13:44. > :13:48.eventually confessed to taking a bribe from Ecclestone. He was
:13:49. > :13:51.sentenced to eight-and-a-half years in jail. The judge said that he
:13:52. > :13:58.assumed Ecclestone was the driving force behind the crime. Earlier this
:13:59. > :14:05.year, another judge, this time in London, also examined the payments.
:14:06. > :14:12.A media company, Constantin, was suing Ecclestone in the civil
:14:13. > :14:15.courts. The lawfailed -- the lawsuit failed but the judge still concluded
:14:16. > :14:20.that Bernie Ecclestone had paid a bribe. How would you describe the 44
:14:21. > :14:24.million paid to Gribkowsky? Bribe. Corruption. Unlawful payments.
:14:25. > :14:32.Totally irregular. Absolutely unacceptable. What did the judge
:14:33. > :14:38.find about MrEcclestone's evidence? I find it impossible to regard him
:14:39. > :14:45.as a reliable or truthful witness. In other words, Mr Ecclestone lied
:14:46. > :14:49.to the court. Bernie Ecclestone said he was unable to respond to our
:14:50. > :14:53.questions because of the bribery trial, but would answer once he had
:14:54. > :14:59.put all the relevant facts before the German court. Which is strange,
:15:00. > :15:05.because he has talked to other journalists about the case. You
:15:06. > :15:09.emphatically maintain your innocence, don't you? Absolutely. No
:15:10. > :15:13.corrupt agreement, no corrupt bargain? No, no. In fact
:15:14. > :15:21.Ecclestone's story has changed over time. When he was first asked about
:15:22. > :15:25.the payments he denied all knowledge of them. When he was interviewed by
:15:26. > :15:30.the German prosecutor, Ecclestone had another explanation. Blackmail.
:15:31. > :15:34.This time he admitted he had paid the money, but only because he was
:15:35. > :15:37.worried Gribkowsky might tell the taxman he was evading tax through
:15:38. > :15:49.the family's Bambino trust. Ecclestone had put his fortune
:15:50. > :15:54.beyond the reach of the taxman by giving it away. But if the reenough
:15:55. > :15:59.thought he secretly con-- revenue thought he secretly controlled the
:16:00. > :16:06.family trusts, then all that money could be taxed. Ecclestone feared
:16:07. > :16:12.Gribkowsky would tell the taxman that he controlled Bambino, that he
:16:13. > :16:17.was the person who would set it up -- who had set it up, the settler.
:16:18. > :16:20.Ecclestone says he has never been connected with Bambino, but he
:16:21. > :16:24.feared a false claim from Gribkowsky could lead to a huge tax bill, which
:16:25. > :16:30.is why he paid Gribkowsky millions of dollars to keep him quiet. I was
:16:31. > :16:34.worried that Mr Gribkowsky could inform the revenue office that I
:16:35. > :16:39.could be the settler of the trust that. Would have cost me more than 2
:16:40. > :16:47.billion... Yes, you heard that right. That would have cost me more
:16:48. > :16:52.than 2 billion... By his own admission, Ecclestone would owe an
:16:53. > :16:58.incredible $2 billion if the taxman decided he was the settler. The
:16:59. > :17:03.German judge didn't believe Ecclestone's blackmail claim and
:17:04. > :17:07.neither did the judge in England. The judge concluded that Mr
:17:08. > :17:13.Ecclestone had lied to him in relation to that and that the story
:17:14. > :17:17.of a shake down was thoroughly implausible. I think Bernie
:17:18. > :17:22.Ecclestone went into court thinking that it didn't really matter what he
:17:23. > :17:28.said because he's above the law. He just thought that all he had to do
:17:29. > :17:33.was to go in and make some sort of frankly ludicrous claim and people
:17:34. > :17:39.would go, ha-ha, and pat him on the head and let him get away with it.
:17:40. > :17:43.He should be held to account. What's beyond any doubt is that if
:17:44. > :17:49.Ecclestone did set up the trusts, then he would face a massive tax
:17:50. > :17:56.bill. And evidence we've uncovered suggests he may be closer to them
:17:57. > :18:00.than he claims. This is Luc Argand. He told the German prosecutor he was
:18:01. > :18:07.one of Ecclestone's lawyers and not only helped set up the trusts, but
:18:08. > :18:14.also-ran them for a time. To some, that seems an unhealthy connection.
:18:15. > :18:21.Trustees need to be independent and to be able to exercise real trustee
:18:22. > :18:26.control. The danger of using your own professional to do that may be
:18:27. > :18:33.that the element of independence may be in question. Argand admitted to
:18:34. > :18:39.the German prosecutor there was a risk to him being involved. I was
:18:40. > :18:43.known as the advisor of Mr Ecclestone, who is a prominent
:18:44. > :18:53.figure. From a tax perspective, it was a risk if I became too close to
:18:54. > :18:58.the trust that. Trust. To avoid suspicion, Argand took action. He
:18:59. > :19:03.stepped back and his wife took his place instead. We found other
:19:04. > :19:13.possible links between Ecclestone and the trust's affairs.
:19:14. > :19:19.This is Kensington Palace Gardens, where you'll find some of the most
:19:20. > :19:27.expensive homes in the world. In 2001, the Ecclestone family paid ?50
:19:28. > :19:38.million for a home here, billed as the most opulent private residence
:19:39. > :19:42.in the country. The house was bought by one of the family trusts, but
:19:43. > :19:49.according to court papers obtained by Panorama, it was Bernie
:19:50. > :19:54.Ecclestone who negotiated the price the trust paid. It's unclear why the
:19:55. > :19:59.trust bought the home because his then wife, Slavica, didn't want to
:20:00. > :20:04.move in. So, three years later, the trust put the house up for sale.
:20:05. > :20:08.Court papers say that once again Bernie Ecclestone was involved. He
:20:09. > :20:13.showed an agent for a prospective buyer around and discussed a price
:20:14. > :20:17.for the house. If Ecclestone has no financial interest in the trust, why
:20:18. > :20:24.did he involve himself in buying and selling its ?50 million mansion? On
:20:25. > :20:28.what basis are the trustees interested in your views as to the
:20:29. > :20:34.price at which it should sell a house, if you're not a beneficiary
:20:35. > :20:41.of those assets? That's certainly something surprising. So one of
:20:42. > :20:47.Ecclestone's lawyers set up the trusts and he himself seems to have
:20:48. > :20:51.acted for one of them. But has he ever benefitted from the trusts and
:20:52. > :20:56.all that wealth he gave away? We've uncovered evidence that Ecclestone
:20:57. > :21:04.may have ended up with hundreds of millions of dollars from the family
:21:05. > :21:09.trusts. The payments started after Slavica and Bernie Ecclestone
:21:10. > :21:12.divorced in 2009. According to the transcripts we've obtained,
:21:13. > :21:17.Ecclestone's lawyer told the German prosecutor that Ecclestone began to
:21:18. > :21:21.get cash from his ex-wife as part of the settlement. After the divorce
:21:22. > :21:28.settlement there were such payments, with regards to the amount, I'd
:21:29. > :21:32.rather not answer due to my lawyer's confidentiality obligation. Another
:21:33. > :21:36.lawyer, who hens run the -- who helps run the trusts was willing to
:21:37. > :21:39.reveal the figure. Since his divorce, Mr Ecclestone has been
:21:40. > :21:44.receiving payments from his wife. I don't know the exact figure, however
:21:45. > :21:54.it must be about $100 million a year. Yes, you heard that right.
:21:55. > :21:58.Must be about $100 million a year. $100 million a year is one of
:21:59. > :22:02.Britain's biggest ever divorce settlements. The money comes from
:22:03. > :22:07.the family trusts that include Bambino. They hold the wealth
:22:08. > :22:11.Ecclestone gave away, but some of the cash has come back to him as
:22:12. > :22:17.part of his divorce settlement. There have been a number of very
:22:18. > :22:20.obvious pieces of evidence about Bernie Ecclestone's relationship
:22:21. > :22:28.with Bambino and it should be investigated. The German prosecutor
:22:29. > :22:33.appears to believe there's little separation between Ecclestone and
:22:34. > :22:39.the Bambino family trust. Ecclestone is accused of being behind the whole
:22:40. > :22:45.$44 million bribe to Gribkowsky, even though half was handed over by
:22:46. > :22:48.the trust. He paid money to the German banker, at the same time as
:22:49. > :22:53.the trust paid money to the German banker. I'm sorry, there are obvious
:22:54. > :22:58.questions that arise out of this. Ecclestone has pulled off one of the
:22:59. > :23:04.biggest personal tax dodges in British history, managing to shield
:23:05. > :23:08.potentially $2 billion from the taxman. 2 billion is a pretty
:23:09. > :23:14.substantial loss of tax. I'm not aware of anything else remotely
:23:15. > :23:20.approaching that sort of magnitude in my fairly extensive experience.
:23:21. > :23:27.Bernie Ecclestone told us he personally paid 51. 51.75 million in
:23:28. > :23:31.tax last year. He said, "I'm proud to be British. Proud to live in
:23:32. > :23:34.Britain and proud to make my contribution by paying my taxes
:23:35. > :23:41.here. My divorce is a private matter."
:23:42. > :23:44.What does the British taxman make of this? Her Majesty's Revenue
:23:45. > :23:49.Customs doesn't comment on individual cases but our transcripts
:23:50. > :23:52.show the revenue spent knife years investigating the -- nine years
:23:53. > :23:57.investigating the trusts before offering them a secret deal. Nrchlts
:23:58. > :24:04.summer 2008, the inland reenough offered to conclude the matter if we
:24:05. > :24:11.paid ?10 million. We decided to pay up. N so an arrangement that
:24:12. > :24:17.Ecclestone admits has saved $2 billion in tax was secretly signed
:24:18. > :24:20.off by the taxman in return for a ?10 million payment from the trusts.
:24:21. > :24:23.That may be a reflection of the evidence, but the trusts make that
:24:24. > :24:31.kind of money in interest payments alone every six weeks.
:24:32. > :24:34.10 million may sound like a lot to some people, but you have to look at
:24:35. > :24:37.it in the round. If we're talking about a trust fund in which they are
:24:38. > :24:46.making huge amounts of money like, this then it is very much, is it? A
:24:47. > :25:10.lawyer for the Ecclestone family trusts in lick stone htenstein said:
:25:11. > :25:16.Slavica Ecclestone's lawyer said her state planning was based on legal
:25:17. > :25:21.advice and that the family trusts were managed by appointed trustees
:25:22. > :25:27.and do not include Bernie Ecclestone. Mrs Ecclestone is
:25:28. > :25:28.entitled to privacy and confidentiality in her tax and
:25:29. > :25:48.personal affairs. The German court case is scheduled
:25:49. > :25:53.to last six months. Ecclestone is facing the same judge who previously
:25:54. > :25:58.jailed Gribkowsky and who said Ecclestone was the driving force
:25:59. > :26:02.behind the crime. Even if he is convicted, the great deal maker may
:26:03. > :26:06.have one last card to play, under the German legal system, he may be
:26:07. > :26:12.able to avoid going to jail by paying a multimillion euro fine. In
:26:13. > :26:18.any other business, Ecclestone would surely have been fired already. He's
:26:19. > :26:24.been told by CVC, the sport's owner, he will be sack today found guilty.
:26:25. > :26:27.What do people in Formula One really think about Bernie Ecclestone? They
:26:28. > :26:35.will be jealous of the money he's made, for sure. He's richer than all
:26:36. > :26:40.of them put together. Probably five, ten times over! Do you have any
:26:41. > :26:43.sympathy for him right now? Not really. Bernie knows what he's
:26:44. > :26:48.doing. Some of those close to Formula One
:26:49. > :26:53.think that the Bernie Ecclestone era may be far from over. He's been in
:26:54. > :27:01.scrapes of one kind and another all of his life. Berne yip always comes
:27:02. > :27:08.out on top. I'd be amazed if this turns out to be the one situation
:27:09. > :27:12.that Bernie can't deal himself out of. It will probably involve his
:27:13. > :27:15.continuing to be involved in Formula One. Bernie Ecclestone has
:27:16. > :27:20.repeatedly avoided our questions about his tax affairs. We caught up
:27:21. > :27:25.with him outside court. Mr Ecclestone, BBC Panorama, Mr
:27:26. > :27:31.Ecclestone, did you avoid $2 billion in taxes? Mr Ecclestone? Mr
:27:32. > :27:38.Ecclestone, why won't you answer our questions?
:27:39. > :27:45.He won't answer our questions, but the taxman is again investigating
:27:46. > :27:49.his relationship with the family trusts. Many people have come to the
:27:50. > :27:52.conclusion that he is not someone who should be relied on to tell the
:27:53. > :28:00.truth. It seems to me, there is something wrong and it should be
:28:01. > :28:08.investigated. One of the world's biggest sports is run by a serial
:28:09. > :28:11.liar, who two judges said paid a multimillion dollar bribe, so what
:28:12. > :28:22.will it take for Bernie Ecclestone to be removed from Formula One?
:28:23. > :28:30.Wednesday, 9pm, a Panorama special: Undercover filming exposes the
:28:31. > :28:34.distress of poor care. Oh, no. In different care homes what relatives
:28:35. > :29:19.don't see, behind closed doors, elderly care exposed.
:29:20. > :29:20.to explore the stories that matter to you.
:29:21. > :29:25.BBC Radio 5 live is where news comes to life.