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Secret Files Reveal HSBC Helped High Profile Clients Dodge Taxes

Posted: February 10th, 2015 | Author: | Filed under: Business News, CRIME! | Tags: , , , , | Comments Off on Secret Files Reveal HSBC Helped High Profile Clients Dodge Taxes

HSBC: Secret files reveal bank helped businessmen, models and sports stars dodge taxesA cache of secret bank files shows HSBC’s Swiss banking arm helped wealthy customers avoid taxes and hide millions of dollars, according to a report by a network of investigative journalists.

The files, analysed by reporters in the International Consortium of Investigative Journalists (ICIJ), showed the British banking giant provided accounts to international criminals, corrupt businessmen, politicians and celebrities.

The files list a range of former and current politicians from Britain, Russia, India and Africa, as well as Saudi, Bahraini, Jordanian and Moroccan royalty, late Australian press magnate Kerry Packer and model Elle Macpherson ::::

“HSBC profited from doing business with arms dealers who channelled mortar bombs to child soldiers in Africa, bagmen for third-world dictators, traffickers in blood diamonds and other international outlaws,” the ICIJ reported.

The files list a range of former and current politicians from Britain, Russia, India and Africa, as well as Saudi, Bahraini, Jordanian and Moroccan royalty, late Australian press magnate Kerry Packer and model Elle Macpherson.

The revelations were likely to stoke calls for a crackdown on sophisticated tax avoidance by the wealthy and by multinational companies.

Notes in the files indicated HSBC workers were aware of clients’ intentions to keep money hidden from national authorities.

Of one Danish account holder collecting cash bundles of kroner, an employee wrote:

“All contacts through one of her three daughters living in London. Account holder living in Denmark, i.e. critical as it is a criminal act having an account abroad non declared.”
In another memo, an HSBC manager discussed how a London-based financier codenamed Painter and his partner could avoid Italian tax:

“The risk for the couple is, of course, that when they return to Italy the UK tax authorities will pass on information on them to the Italian tax authorities. My own view on this was that … there clearly was a risk.”
In response to the reports, HSBC Holdings Plc admitted failings by its Swiss subsidiary.

“We acknowledge and are accountable for past compliance and control failures,” HSBC said in a statement.

It said that its Swiss arm had not been fully integrated into HSBC after its purchase in 1999, allowing “significantly lower” standards of compliance and due diligence to persist.

Businessmen, politicians, sportsmen, models named in files

The investigation was done by the ICIJ, linked to the US-based Centre for Public Integrity, which enlisted more than 140 journalists from 45 countries in cooperation with France’s Le Monde, Britain’s BBC and The Guardian, US program 60 Minutes, German newspaper Suddeutsche Zeitung and more than 45 other media organisations.

Names in the files included people sanctioned by the US, including Turkish businessman Selim Alguadis, and Gennady Timchenko, an associate of Russian president Vladimir Putin targeted by sanctions over Ukraine.

Mr Alguadis told the ICIJ it was prudent to keep savings off-shore, while a spokesman for Mr Timchenko said he was fully compliant with tax matters.

Also named were designer Diane von Furstenberg, who told the ICIJ the accounts were inherited from her parents, and Elle Macpherson, whose lawyers told the ICIJ she was fully in compliance with UK tax law.

Motorcycle champion Valentino Rossi, listed as having $23.9 million in two accounts, said he had regularised his tax situation with Italian authorities.

The files were a version of a set obtained by former HSBC employee-turned-whistleblower Herve Falciani, who copied thousands of bank documents before fleeing from Switzerland to France where they were obtained by tax authorities in 2009.

They were used by the French government to track down tax evaders and shared with other states in 2010, leading to a series of prosecutions for tax evasion.

HSBC Private Bank, the Swiss subsidiary of the British banking group, is under formal investigation in a French probe into tax fraud.

In 2012, HSBC paid a record $1.9 billion fine in a settlement in a money laundering case after a US Senate investigation found it was used to launder hundreds of millions of dollars for Mexican drug cartels.


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source: afp
image source: indeepmedia/afp

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