State prosecutors searched offices of Germany's biggest lender, Deutsche Bank, on Wednesday in a widening probe linked to a tax evasion scheme involving the trading of carbon permits. Frankfurt public prosecutors said they were investigating suspicions of severe tax evasion, money laundering and obstruction of justice against 25 bank staff and had arrested five of them.

Around 500 police and tax inspectors searched Deutsche Bank premises and private residences in Frankfurt, Duesseldorf and Berlin, prosecutors said in a statement. Tax inspectors clutching backpacks and suitcases were seen leaving Deutsche Bank's headquarters in Frankfurt, where about 20 police minibuses and two large coaches were parked outside. Eight policemen wearing dark blue overalls and armed with handguns were stationed in the lobby. In October, a financial source familiar with the matter said Deutsche had suspended a handful of employees after it was criticised by a judge last year.

Copyright Reuters, 2012