Deutsche Bank suspends carbon traders - source

FRANKFURT, Oct 4 (Reuters) - Deutsche Bank has suspended a handful of employees after it was criticised by a judge last year during a trial into tax evasion on carbon permits, a financial source familiar with the matter said on Thursday.

Deutsche Bank declined to comment on whether any employees had been suspended.

In December, a German court sentenced six men to jail for participating in a conspiracy to evade around 300 million euros ($387 million) in value-added tax (VAT) on carbon permits between August 2009 and April 2010.

The judge said the way Deutsche Bank conducted emissions trading with some of the convicted men had left the door open for tax evasion.

However, no member of Deutsche Bank's staff was charged and the bank said at the time that independent legal experts had found no wrongdoing on the part of its employees.

It was unclear when the traders were suspended. The suspensions were first reported by Germany's Sueddeutsche Zeitung.

Since June, when Deutsche Bank's new co-Chief Executives took the helm, the lender has announced it would make a renewed push to bring about "cultural change," clarifying the different kinds of behaviour it would not tolerate.

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In 2009 and 2010, the European Union's spot carbon market was hit by a so-called carousel trade in which buyers imported emissions permits in one EU country without paying value-added tax (VAT) and then sold them to each other, adding tax to the price and pocketing the difference.

The EU Emissions Trading System, the bloc's chief weapon against climate change, caps the emissions of factories and power plants, forcing them to buy carbon permits if needed while also allowing them to sell surpluses.

Germany carried out the biggest swoop on suspects and investigated more than 100 people and 50 companies in coordination with other EU nations.

The EU carbon trading scheme has suffered a series of scandals since its launch in 2005, including permit theft, the recycling of carbon credits and hacking of carbon accounts.

(Reporting by Edward Taylor and Alexander Huebner; Editing by Ralf Banser and Mark Potter)

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