"Increased cases of tax fraud with regard to the trade of greenhouse gases emissions rights since the spring of 2009 are the subject of the investigation," said a statement issued by the Frankfurt prosecutor in the state of Hesse.
The office said it was coordinating the nationwide probe with federal offices and police and tax offices in several states.
It said that around 50 companies and around 150 suspects were being targeted.
A Deutsche Bank AG spokesman said the bank had received a visit and was supporting the authorities.
The statement said there are suspicions that emissions rights papers had been obtained by suspects abroad via German companies and sold on through a chain of other firms.
The papers for CO2, which is the most prevalent gas that pollutes the environment, are issued to industries across Europe which produce emissions and are freely tradable.
Authorities in Britain, France, Spain, Norway and the Netherlands have all opened investigations into carbon credit fraud over the last year.
The practice targeted in the latest German probe is known as carousel fraud. It implies that the last firm in the chain sells the certificate abroad, declares VAT and collects a reimbursement. Sellers within the chain pocketed the difference for themselves.
The total damage of the cases in the probe is estimated to amount to 180 million euros, the statement said.
(EurActiv with Reuters.)
