Argentina turns up the heat on HSBC with demand for £2.3bn of offshore cash

Guy Bentley
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Argentina lashes out at HSBC (Source: Getty)

Argentina is demanding that HSBC repatriate £2.3bn of its clients' money. The bank stands accused of moving the money offshore for tax advantages.

The head of Argentina's tax authority, Ricardo Echegaray, claimed HSBC's actions threatened the stability of the Latin American state.

Speaking at the Argentine embassy, Echegaray told a host of journalists "HSBC built a platform to help clients evade tax", the BBC has reported.

He told the audience that HMRC made enquiries into Argentina's grievances against HSBC. Last year, Argentina accused the multinational bank of helping 4,000 clients evade tax using Swiss bank accounts.

Echegaray also called for HSBC to come out publicly to state that it "respects" the tax laws. If HSBC fails to do this, the minister said the bank would be accused of "financial piracy".

In January, Argentina suspended HSBC's ability to transfer money abroad for 30 days. HSBC has maintained that it has respected the law and followed the rules.

The bank said in a statement:

HSBC has been cooperating fully with Argentine regulators, including AFIP (the tax authority) and the judiciary, since allegations were first made public last year, and we will continue to do so.

Later today, HSBC bosses will face a grilling from MPs over the Swiss tax evasion scandal. Stuart Guilliver, the bank's chief executive, will appear before the Public Accounts Committee .

BBC Trust chair Rona Fairhead will attend Parliament to answer questions. Fairhead was on the HSBC's audit committee until 2010.

Argentina's troubled economy elicited much comment last year after it defaulted for the second time in 13 years. Talks with bond holders in New York proved unsuccessful.

The so-called "hold-out" investors bought Argentina's debt when it was cheap following the country's economic crisis in 2001-2002. The bond holders asked for a full pay-out of £766m.

Argentina refused and accused the group of profiteering.

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