Lobbyist's Money Strains German Politics

The controversial Frankfurt public relations consultant Moritz Hunzinger appears to have closer ties to German politicians than originally assumed.

Media reports over the weekend disclosed that Cem Özdemir, the Green Party spokesman on internal affairs, took out a 40,900 euro ($41,410) personal loan from Hunzinger in 1999.

Just last week, Chancellor Gerhard Schröder sacked Defense Minister Rudolf Scharping for accepting 71,600 euros ($72,490) from Hunzinger for lectures and book rights just before his posting.

A "naive" mistake

The Özdemir case, however, differs substantially from Scharping's. For one, Özdemir admits that he made a mistake. "I was naive," he says.

Scharping, on the other hand, has denied any wrongdoing. He says the fees were from the time before he was defense minister, although the money entered his bank account after he took on the position.

Özdemir borrowed the money to pay off tax debts. He says he blames himself for not having put aside any reserves for his taxes. He says he also regrets the fact that he didn't approach a regular bank. "Rather, I used the opportunity to take out a private loan via a private contact."

But he stresses that the financial deal with Hunzinger was just a loan, and "not any sort of special payment, not any sort of special donation or fee".

"At the time, I was happy to be quickly and simply helped out of a financial squeeze," he said. "Today, I would refrain from such a procedure."

The politician did, however, get quite a bargain. Whereas the average interest rate at the time was around 9 percent, Özdemir is only paying 5.5 percent interest. He says he will donate the difference to the Center for the Treatment of Torture Victims in Berlin, where he is a member of the advisory board.

Financing politics

Hunzinger, who also has clients in the arms industry, is a member of the opposition Christian Democrats (CDU). For over 20 years, he has built up a dense network of connections to economic and political figures. It includes representatives of every political party, with the exception of the reformed Communist PDS and right-wing extremist groups.

The loan to Özdemir probably would not have become public if it weren't for Hunzinger's connections to Scharping, as it was well-known in the Green party that he had borrowed the funds. "The whole thing doesn't appear kosher because Hunzinger is being seen in a different context today than was the case in 1999," says Özdemir.

The Green politician has made very clear that he has done everything in his power to clarify any misunderstandings regarding the loan. "I didn't turn my cell phone off, I didn't disappear, rather I gave anyone who wanted to hear it extensive information -- on all television channels, on all radio stations, in all newspapers."

Scharping neglected to inform the speaker of the lower house of parliament, the Bundestag, of the additional income. Following a number of other political blunders, Chancellor Schröder had no choice but to sack him.

Özdemir, on the other hand, will probably suffer little more than a scratch on his record. But he certainly learned his lesson, he says. "In retrospect, I can certainly say that this was the most expensive loan of my life."