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Major investigations

Member: Nifa

As news comes of the “extremely severe” sentence handed to Nina Ricci perfume heir, Arlette Ricci by a Paris court for tax fraud, the French authorities have announced that they are opening criminal investigations into HSBC following the so-called Swissleaks scandal. 

Ms Ricci was sentenced to a year in prison and ordered to pay a €1m (£720,000) fine, as well as having two properties worth over €4m (£2.9m) confiscated. She was also given a two-year suspended sentence on top of the custodial sentence.

According to the French authorities, Arlette, the granddaughter of Nina Ricci, hid millions of Euros from the French taxman in an offshore HSBC account in a bid to evade paying tax. She is the first of around 50 French nationals to be tried since the bank’s tax evasion programme came to light,
but her lawyer maintains that she has been made an example of and is going to ask the judge to let her serve the sentence under more lenient conditions such as partial liberty or wearing an electronic tag. 

A former employee of HSBC’s private operation in Switzerland passed a list of thousands of the bank’s clients to the French authorities to investigate in 2009 but not much happened until the documents were reported by the BBC and a host of other international media outlets this year. Interestingly, HM Revenue & Customs was given the leaked data in 2010 and identified 1,100 people from the 7,000 British clients on the list who had not paid their taxes. However, to date, only one person on the list has been prosecuted.

Now though the French authorities have placed HSBC Holdings under a formal criminal investigation in relation to the conduct of its Swiss private bank in 2006 and 2007. The bank has replied that it will defend itself “vigorously” in any future proceedings and no doubt is already using teams of forensic accountants to mount a robust defence.

Author: Roger Isaacs, 17 April 2015

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