Seven current and one former employee of Germany’s Deutsche Bank AG are facing tax evasion charges over their alleged participation in tax fraud schemes involving carbon emission certificates, according to media reports Thursday. The eight -- whose names have not been revealed -- are accused of being involved in fraudulent schemes between September 2009 and February 2010.

“Our own investigations into the matter are continuing unabated,” Deutsche Bank reportedly said in a statement, without providing further details. “We're fully cooperating with the authorities involved.”

The European Union’s Emissions Trading System sets a cap on the carbon emissions of companies, factories and power plants, which have the option to buy and sell carbon permits for additional emissions. If a company fails to cover all its emissions under its “allowances,” it can face heavy fines.

According to the European Commission, this policy can lower emissions by up to 21 percent between 2005 and 2020, and promote investment in clean, low-carbon technologies.

However, because of lack of a harmonized tax regime across the EU, the system can be exploited to commit tax fraud. A loophole allows companies to indulge in a so-called “carousel fraud,” wherein carbon credits are bought and imported tax-free from other EU countries, then sold to domestic buyers, charging them Value-Added Tax (VAT).

The Europol has estimated that VAT fraud within the EU Emission Trading System has cost taxpayers more than 5 billion euros ($5.6 billion) in lost revenue since 2008.

In this particular case, the current and former employees of Deutsche Bank reportedly took advantage of the mechanism to file incorrect VAT notifications at the bank’s tax department, resulting in losses of about 220 million euros ($245 million), Deutsche Welle reported, citing prosecutors in Frankfurt.

The suspects include two account managers, a commodities trader, a tax department employee and a former manager in whose department the emissions trading took place, the Associated Press reported.