Explosive investigation lifts the lid on banking practices from 2005-2007
It sounds like the guest list for one heck of an event.
Russian multi-millionaires, Phil Collins, Tina Turner, David Bowie, wealthy politicians, royals, arms dealers, and of course many wealthy entrepreneurs.
But this isn’t the LA after-party for which your invite must have got lost in the post.
It’s the reported list of clients who were allegedly helped by HSBC’s private bank to hide millions in its Swiss bank accounts, while dodging taxes in their home countries.
An investigation by the International Consortium of Investigative Journalists (ICIJ), working with the Guardian, BBC Panorama and Le Monde, has made the allegations based on leaked HSBC files from 2005, 2006 and 2007.
The Guardian says the files, obtained by whistleblower Hervé Falciani, who was an IT expert at HSBC’s Swiss arm, “amount to the biggest banking leak in history”.
The files show details of more than 100,000 clients across the world, and allegedly demonstrate how “bankers helped clients evade tax and offered deals to help tax dodgers stay ahead of the law”, the BBC reports.
The BBC writes: “HSBC did not just turn a blind eye to tax evaders – in some cases it broke the law by actively helping its clients.”
The files were seen by UK and French authorities some time ago.
France sent details of the bank account activity to other countries in 2010, leading to arrests and action in Greece, Spain, the US, Belgium and Argentina.
When HMRC received the list in 2010, it apparently identified more than 1,000 tax evaders in the UK, the Guardian writes. This enabled it to recover £135m in repayments, though there was only one prosecution in the UK and no legal action taken against HSBC.
In response to the claims, HSBC’s Swiss Private Bank said in a statement that: “In the past, the Swiss private banking industry operated very differently to the way it does today. Private banks, including HSBC’s Swiss private bank, assumed that responsibility for payment of taxes rested with individual clients, rather than the institutions that banked them.
“Swiss private banks were typically used by wealthy individuals to manage their wealth in a discreet manner. Although there are numerous legitimate reasons to have a Swiss bank account, in some cases individuals took advantage of bank secrecy to hold undeclared accounts.”
The bank said: “HSBC Global Private Banking (‘GPB’) and in particular its Swiss private bank have undergone a radical transformation in recent years.
“HSBC has implemented numerous initiatives designed to prevent its banking services being used to evade taxes or launder money.”
As for Tina Turner, Phil Collins and David Bowie, they actually all have Swiss passports, like 14% of the HSBC clients whose details were leaked, Qz.com reports.