'I never asked myself that'

Gerhard Gribkowsky and Bernie Ecclestone exchanged a smile in court on Friday as the convicted former banker took to the stand.

The former BayernLB bank's chief risk officer, convicted in 2012 for tax evasion and corruption for accepting some $44 million channeled to him by Ecclestone, told the court on Friday that he did not know precisely why he was paid the money.

"I never asked myself that question. I'm still annoyed with myself for that today, as you might well imagine. I should have asked - that's clear to me today," Gribkowsky said when asked why the offending payment was made.

This elicited bafflement from presiding Judge Peter Noll, who sentenced Gribkowsky two years ago and heard testimony from Ecclestone in that trial.

"It's hard for me to comprehend [what went on] if you are unable to say more precisely how it came about," Noll told Gribkowsky. Gribkowsky is scheduled for further testimony in the trial, with the terms of his deal with Eccelstone sure to feature in future.

A battle of will?

Gribkowsky and Ecclestone's paths crossed almost by chance in 2003, after the BayernLB bank inherited shares in the commercial rights of Formula One from one of its bankrupt clients, the now-deceased media mogul Leo Kirch.

The prosecution alleges that Ecclestone ultimately funneled the money to Gribkowsky in exchange for the bank executive's brokering a deal with a company that was acceptable to the veteran F1 commercial mastermind. The London-based capital investment firm CVC ultimately bought the rights in 2006, keeping Ecclestone on as the commercial face of F1. Despite taking on a reduced role after his indictment by the Munich court, Ecclestone currently remains in the position.

Ecclestone's lawyers portray the payment more as hush-money, saying that Gribkowsky had threatened the billionaire with tax investigations unless he played along. Ecclestone himself once described this as a "subtle shakedown" - saying that, although he owed no taxes, an investigation alone could have cost him billions.

'Flags of battle were flying'

The prosecution might have hoped for more from Gribkowsky, himself close to the prospect of parole in his eight-and-a-half-year sentence, after the banker's last-gasp confession in his own trial in 2012. Having fought the charges for months, Gribkowsky then described the prosecution's version of events as "essentially true."

On Friday, however, the 56-year-old's testimony seemed broadly supportive of Ecclestone's version of events. Gribkowsky, the flashy risk management officer for the staid bank owned by the state of Bavaria, told the court how his employers wanted him to play hardball with Ecclestone.

"You need to be nasty if you want to get your own way. As the chief risk officer of a bank, you're not exactly everybody's darling," Gribkowsky said.

He described early efforts on both sides to assert authority, such as a gruff phone call ordering that he visit Ecclestone's office posthaste, and his own move to sit in the 83-year-old's chair and light up a cigarillo. Gribkowsky recalled an instant where he said he presented Ecclestone with a paper whose contents he knew would put pressure on the Briton, albeit saying he no longer remembered the information.

"The flags of battle were flying," Gribkowsky told the court.

Following this early friction, Gribkowsky said he opened discussions with major car manufacturers, simultaneously the sport's key contributors and sponsors at the time, on how to limit Ecclestone's longstanding influence. Teams periodically display dissatisfaction with their cut of F1's proceeds - funds are raised centrally by Ecclestone and then distributed, largely based on performance - and Gribkowsky said he initially sought to foment this unrest.

'I will take care of you'

By 2005, Gribkowsky said, his relationship with Ecclestone had picked up - a development that coincided with Ecclestone's quashing F1's breakaway rumors of the era by getting the key manufacturer Ferrari in his corner, thus weakening the other competitors' hands.

"I realized Formula One can't exist without Mr. Ecclestone," Gribkowsky said, adding that, at this point, Ecclestone told him: "I will take care of you." He said that he had inferred this comment to mean the prospect of a job in F1, an opportunity that would have appealed to him.

In charge of the financial side of Formula One since the 1970s, to a greater or lesser extent, Ecclestone could face a maximum of 10 years in prison if convicted of bribing Gribkowsky. The case has been scheduled around Ecclestone's F1 responsibilities, meaning the 26 trial days currently allocated are scheduled to run into September. The next F1 race is the Spanish Grand Prix at the Circuit de Catalunya on Sunday.

msh/mkg (AFP, dpa, Reuters)