Swiss probe ends as HSBC pays out £28m
SWISS prosecutors have dropped their investigation into HSBC’s private bank operations, after the company agreed to pay the authorities in Geneva 40m Swiss francs (£28m) yesterday.
The authorities had long been looking into allegations of money laundering at the firm’s Swiss private bank. Earlier this year, Geneva’s public prosecutor searched HSBC’s offices as part of the probe.
Europe’s largest lender did not admit guilt or wrongdoing as part of the settlement, but said in a statement yesterday that the 40m Swiss franc payment was to compensate for its past organisational failings.
HSBC said it “acknowledged that the compliance culture and standards of due diligence in place in the bank in the past were not as robust as they are today.”
The bank also said it has since improved practices to keep clients from using the bank “to evade taxes or launder money,” and, in doing so, has drastically reduced the number of private Swiss accounts, from 30,000 to 10,000.
The Geneva prosecutor said that no criminal charges would be filed, and that the settlement “avoids the uncertainties of a long and complex legal case.”
Scrutiny of HSBC’s Swiss unit stretches back nearly seven years to 2008, when one of the bank’s former IT employees, Herve Falciani, fled Geneva with files which were alleged to show evidence of tax evasion by its clients. Falciani turned the files in to French authorities, who in turn shared them with other countries, including Switzerland.
HSBC is still being investigated in a number of territories over allegations of tax evasion, including in the US, France, Belgium and Argentina.
KEY DATES IN THE HSBC TAX AVOIDANCE SCANDAL
DECEMBER 2008
Police in Switzerland detain former HSBC IT employee Herve Falciani in Geneva. Whistleblower Falciani flees to France.
EARLY 2010
Then French finance minister Christine Lagarde begins sharing Falciani’s files with other countries, including Greece.
FEBRUARY 2015
Media outlets publish excerpts from the leaked files, leading the bank to apologise for wrongdoing.
JUNE 2015
HSBC settles with Swiss authorities, paying a £28m fee. Probes remain ongoing in the US, France, Belgium and Argentina.