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Tax-break scandal rocks West German Cabinet

Economics Minister Count Otto Lambsdorff and the head of a major West Germany bank were charged in a $175 million tax-break scandal, prosecutors announced Tuesday.

Bonn public prosecutor Johannes Wilhelm said he had filed charges against Count Lambsdorff, Dresdner Bank president Hans Friderichs, and three others after the investigation of payments made by the Flick conglomerate to politicians, allegedly in return for massive tax concessions.

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The announcement, which comes after a two-year investigation, is a severe embarrassment to the government of Chancellor Helmut Kohl and may lead to Cabinet changes. As a deputy Count Lambsdorff cannot face court charges unless he chooses to resign or Parliament agrees to lift his immunity from prosecution. Lambsdorff denied any wrongdoing and said he would announce his plans in the next few days.

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