He was indicted for evading 11 million euros (15.7 million dollars) in taxes on the commissions he received to facilitate sales by Germany between 1988 and 1993 of Airbus planes and helicopters and 36 of the Fuchs six-wheeled armoured vehicles.
He is also accused of being an accessory to fraud. If convicted, he faces up to 15 years in jail. The trial is to last till at least mid-May. Schreiber's lawyers said Monday he had been only a cog in a process where leading German politicians were the main decision-makers. "He admits he was involved," said Jan Olaf Leisner, a Schreiber lawyer, in a TV interview outside the court.
Schreiber is believed to have partly used the commissions to make a huge donation to the Christian Democratic Union (CDU), the party led by the chancellor of the time, Helmut Kohl.
Sales of sophisticated German weaponry to Arab nations were difficult to organise, given their potential to upset both Israel and the general public, and Schreiber was seen as a "fixer" who could make the impossible happen. The judges say he cannot be charged with bribery because the time to indict him has expired. Prosecutors plan to appeal against this.
The German media have shown intense interest in the case, expecting Schreiber to name those whom he coaxed in the 1990s. No one has ever been convicted of giving or taking a bribe for the 100-million-euro sale of second-hand Fuchs vehicles built by German firm Thyssen. A former German defence official and national spy chief, Ludwig- Holger Pfahls, has been called as a witness. He testified in the past that he received 2.5 million dollars from Schreiber. Pfahls, a deputy defence minister at the time, put a stamp of approval on the sale.
But former German chancellor Kohl and former foreign minister Klaus Kinkel have testified that Pfahls did not influence the export decision. Pfahls was later convicted of evading taxes on the 2.5 million dollars, but not of taking a bribe. Schreiber, who skipped the country in October 1995, spent nearly 14 years resisting extradition with legal counter-moves. Canada sent him in August last year back to his homeland to face the charges. Prosecutors told the court Schreiber set up front companies in Liechtenstein and Panama as conduits for commissions, and appointed trustees to run them so that German tax officials would not consider the money as his.
Marcus Paintinger, a prosecutor, said the evasion was based on a "tissue of lies that the tax authorities could not penetrate." He said Schreiber received total commissions between 1988 and 1993 of 64 million deutschmarks (32.7 million euros), and should have paid income tax on this of 12.3 million euros. He is charged with evading 11 million euros in tax, because some claims are out of time. After the scandal, Germany made disclosure of big contributions mandatory and increased its state funding for political parties so that they would be less dependent on huge donations from lobbyists.