German prosecutors have accelerated their investigation into alleged corruption in the sale of Formula One to the private equity firm CVC in 2006. On the receiving end of their wrath is Stephen Mullens who is the former lawyer of Bernie Ecclestone's Bambino family trust and has been charged by prosecutors according to a report in the Sunday Telegraph written by Christian Sylt.

Mullens has been charged in connection with an alleged $44m bribe paid by Bambino and Ecclestone which is said to have steered the sale of a 47.2% stake in F1 to the private equity firm CVC in 2006.

Mullens is the fourth person to be charged by German authorities in this investigation. The first was Gerhard Gribkowsky, the banker responsible for selling the 47.2% stake which was owned by German lender BayernLB (BLB). Gribkowsky was convicted for receiving the alleged bribe in 2012 and, since then, his former lawyer Gerald Toifl has also been charged along with Ecclestone who is due to be put on trial in Munich in April.

Margarete Noetzel, spokesperson for the Munich court, confirmed that "the public prosecutor has charged Mr Mullens with an indictment from the Munich Regional Court dated 29 October 2013. The indictment was translated and delivered in the middle of November. The trial chamber has not yet decided on an opening date."

The claim against Mullens is different to the one against Ecclestone. Prosecutors believe that Ecclestone bribed Gribkowsky to steer the sale of F1 to CVC as it had agreed to keep him as the boss of the sport. Inherent to the case against Mullens is the claim that Gribkowsky was paid in return for him helping Bambino to be paid a $313m loan which F1's parent company SLEC had used in 2001 to pay to the FIA to buy the commercial rights to the sport for 100 years.

Bambino provided $78m of the loan to SLEC in line with its 25% stake in the company with the remaining $235m coming from the German media firm Kirch which controlled 75% of F1 through its subsidiary Formel Eins Beteiligungs (FEB). Kirch went bankrupt in 2002 and its principal creditor happened to be Gribkowsky's employer BayernLB. Kirch had transferred the right to repayment of the $235m from SLEC and it ended up being held by a Swiss company called Kamos. Accordingly, there was a question over whether SLEC should have paid the $235m to Kamos or whether it should have ultimately gone to Kirch's creditor BayernLB.

This question had not been answered by the time that CVC bought F1 and since it didn't want the company to have any outstanding debts it deducted $313m from the purchase price and paid the money to Bambino so that it could be held in escrow pending the decision on whether $235m of it should ultimately go to BayernLB or to Kamos.

As Gribkowsky worked for BayernLB at that time, it would have been a serious breach of his duty if Mullens really had arranged for him to be paid in return for helping to get Bambino named as the legal recipient of the $235m. Both Ecclestone and Mullens deny doing this. It is at the heart of the charge against Mullens as explained in the German indictment against Ecclestone which states:

"Mr Mullens requested Dr. Gribkowsky to support collection of the loan receivables due from the FEB-SLEC loan on the part of Bambino, including the share of $235 million accruing to the former SLEC partner, FEB (Kirch Group), not only Bambino's share of $78 million. With regard to the $235 million share of the loan, it was in the sole interest of BayernLB that this claim for repayment of the loan be collected by the receiver appointed for its former debtor, namely the lawyer Dr. Jaffé, in favour of Kirch's insolvent
estate and consequently to the economic advantage of its principal creditor, BayernLB."

The repayment of this loan was outlined in the initial agreement, dated November 2005, between Bambino and an Austrian company connected to Gribkowsky. Bambino was listed as the 'Client' with the Austrian company being the 'Consultant'. The agreement stated that "the Consultant has agreed to advise the Client in connection, the acquisition of debt claims against SLEC Holdings Limited other than those of the Client with a view to motive a profit."

This was covered in detail in last year's civil case against Ecclestone, Mullens, Bambino and Gribkowsky in London's High Court which had been brought by German media rights firm Constantin Medien. It claimed to have lost out as a result of the alleged bribe because it had an agreement to get 10% of the proceeds if the 47.2% stake sold for more than $1.1bn. As CVC paid $814m Constantin got nothing which is why it sued. The lawsuit said that the 47.2% stake was undervalued as other buyers may have paid more than CVC. However, the judge, Mr Justice Newey, disagreed and ruled that "no loss to Constantin has been shown to have been caused."