Deutsche Bank is the unnamed foreign bank that reportedly played a key role in a fraudulent tax shelter that helped wealthy persons avoid paying more than
$103 million in taxes, a person familiar with the probe said, according to a report by the New York Times.

Deutsche Bank
is "Bank B" in a criminal indictment unsealed last week in


New York against

John Ohle, a lawyer and certified financial advisor, a person familiar with the investigation said.

Prosecutors have alleged Mr Ohle, who for a time was a supervisor in Bank One's Innovative Strategies Group in


Chicago, conspired with lawyers at now defunct law firm Jenkens & Gilchrist to market a tax-shelter known as Hedge Option Monetization of Economic Remainder, or Homer, to help high net worth individuals reduce or eliminate their income taxes.

The New York Times reported in its editions Monday that Bank B was
Deutsche Bank. A
Deutsche Bank
spokesman in

New York and a spokeswoman for the US Attorney's office in

Manhattan declined to comment yesterday.

According to the indictment, a client who used the Homer shelter would buy so-called "barrier options," or specialised foreign currency or bond options, from Bank B, or
Deutsche Bank
, as part of the tax strategy. The transactions were designed so that two of the options would be "in the money" and two of the options would be worthless, prosecutors said.

The client would be able to record the losses on the losing options and use the proceeds, after they passed through a third-party partnership, to repay a loan it took out from Bank B to purchase the options in the first place, the government said. The partnership included a childhood friend of Mr Ohle, prosecutors said.

As a fee for implementing the transaction, Bank B, or Deutsche Bank
, would charge a premium of 1.25 per cent of the desired tax loss, according to the indictment.