Rebukes Are Swift For The Chief Of Deutsche Post

BERLIN — The German political elite has wasted no time in dissociating itself from Klaus Zumwinkel, the chief executive of Deutsche Post, who is suspected of using a foundation in Liechtenstein to evade taxes.

Mr. Zumwinkel, who turned the formerly state-owned Deutsche Post into the world’s largest logistics concern, has been widely respected for turning debt-ridden and poorly run companies, like the giant mail-order retailer Quelle, into highly successful ones.

But Chancellor Angela Merkel, in particular, was quick to denounce Mr. Zumwinkel, 64, when it became clear last week that prosecutors had started a criminal investigation into allegations that he dodged the equivalent of $1.5 million in taxes.

“This goes beyond anything I could have imagined,” she said, adding that his resignation from the board of Deutsche Post “was an unavoidable step considering what has happened.”

Peer Steinbrück, the Social Democrat who is finance minister, said the investigation into Mr. Zumwinkel’s tax affairs was damaging the already shaky state of public confidence. “The moral damage is considerable,” he told reporters.

Politicians of both parties also called this weekend for tougher sentences for tax fraud after the German media reported that, according to investigators, as many as 1,000 investors are also suspected of having foundations in Liechtenstein to escape taxes in Germany.

This tax scandal, one of the biggest ever to hit Germany, comes at a particularly fragile time when politicians have been accusing private company managers of being too well paid and lacking in social responsibility. The Social Democrats in particular, but also Ms. Merkel’s conservatives, have tried to exploit this issue recently.

Mr. Zumwinkel’s annual salary was 4 million euros ($5.9 million) last year, small when compared with the 13.2 million euros earned by the Deutsche Bank chairman, Josef Ackermann, or the 60 million euros paid to Wendelin Wiedeking, chief of Porsche.

But Mr. Zumwinkel also enjoys perks like a healthy pension plan and share options. It is too early to say whether those will be affected by his resignation.

He came in for criticism last December when he sold 200,000 shares, worth 2.24 million euros, just after Deutsche Post’s share price jumped on an agreement by the company to introduce a minimum wage.

He later apologized for his actions. But Mr. Zumwinkel, who studied economics at the Wharton School in Philadelphia in the 1970s, set out his own ideas about a market economy in comments he made several years ago.

“You cannot organize a market economy according to purely moral principles. It will go bankrupt,” he said three years ago in an interview with Bild am Sonntag, a mass circulation newspaper.

“The international market knows no morality.”

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