Deutsche Post Chief Executive Klaus Zumwinkel is being investigated for suspected tax evasion, a source close to the investigation said on Thursday as police raided his home and offices.
A company spokesman confirmed the dawn raid at the group's office tower in the western German city of Bonn and that 64-year-old Zumwinkel was the focus of the inquiry, but declined to say what he was being investigated for.
German media reported earlier on Thursday that Zumwinkel was suspected of having transferred millions of euros to a bank account in Liechtenstein to evade German taxes.
Zumwinkel's private villa in a leafy suburb of the nearby city of Cologne was also raided in the early hours of Thursday, according to the source.
Hours later, reporters and camera teams still swarmed outside the CEO's large, three-storey house. There was no sign of Zumwinkel, a pillar of Germany's corporate establishment, whom Germany's Manager Magazin named its 2003 "manager of the year."
Highlighting the seriousness of the case, a source close to the investigation told Reuters prosecutors had obtained an arrest warrant for Zumwinkel but were not acting upon it.
"It looks very unlikely at the moment that the warrant will be exercised," the source said.
A spokesman for the prosecutors confirmed that "several persons" were being investigated for tax evasion, but declined to say who was under investigation.
"At the moment, investigations are taking place in Cologne and Bonn," the spokesman said.
Zumwinkel, a self-described multi-millionaire, has been at the helm of mail and logistics group Deutsche Post since 1990, making him the longest-serving chief executive of any company in the DAX index of top German companies.
Shares of Deutsche Post were the top gainers in the DAX on Thursday, up 2.8 percent at 22.25 euros.
"The speculation now is that Zumwinkel will go and that's seen as very positive in the market," said one trader.
Zumwinkel, who presided over the group's flotation in 2000 and took the helm of Deutsche Telekom's supervisory board in 2003, said late last year he would decide on his future with Deutsche Post in the summer of 2008 as his contract is due to run out in November.