HSBC agrees to 300 mln euro settlement of Belgian tax fraud case: prosecutors
07 Aug 2019

HSBC’s Swiss private banking arm has agreed to pay nearly 300 million euros ($336 million) to settle a tax fraud case in Belgium, Belgian prosecutors said on Tuesday, the latest blow for the Alpine state’s banking sector from the EU.

The settlement comes after a French court in February ordered UBS (UBSG.S), another Swiss lender, to pay 4.5 billion euros in penalties for illegally soliciting clients and laundering the proceeds of tax evasion.

UBS, which is under investigation in Belgium for a similar case, denies the charges.

Swiss banks have been exposed to such legal challenges since 2004, when Bern agreed to apply a European Union tax on the savings income of its lenders’ EU clients.

The Belgian prosecutors said in a statement that HSBC was “charged by a prosecutor in 2014 for serious and organized tax fraud, forgery and falsification of records, money-laundering and illegal use of financial intermediaries.”

They alleged that HSBC helped and encouraged the avoidance of the EU savings tax by creating off-shore companies in Panama and other tax havens in the Caribbean for wealthy Belgian clients “with no other purpose but to hide money”.

A spokesman for HSBC declined to comment.

The prosecutors also said that the bank had made and committed to a significant overhaul of its practices to counter financial crime risks following the allegations.

By Francesco Guarascio, Reuters, 6 August 2019

Read more at Reuters

Photo (cropped): ペウゲオト [CC BY-SA 3.0], via Wikimedia Commons

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