German prosecutors on Wednesday submitted charges against two British investment bankers with severe tax evasion in relation to the so-called Cum-Ex scandal.

The charges, brought before the Bonn district court by Cologne's public prosecutor, could lead to Germany's first criminal case stemming from Cum-Ex.

For years, German authorities have investigated hundreds of tax fraud cases stemming from the EU-wide tax evasion scandal.

The cases involved banks and stock brokers trading shares with ("cum") and without ("ex") dividend rights, with the aim of being able to conceal the identity of the actual owner and allow both parties to claim tax rebates on capital gains taxes.

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The Cologne prosecutor's office has submitted charges against two British citizens

'Legal' loophole

Many of those accused of illegally gaining from the tax rebates say they only exploited a "legal" loophole to pay less taxes.

Reports issued last year showed that the loophole robbed European treasuries of up to €55 billion ($62 billion) in taxes. Germany has sought to prosecute the cases but has been unable to due to a lack of financial investigators.

It is now up to the Bonn district court to decide whether to move forward with prosecution.

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ls/jm (Reuters, dpa)