HSBC help millionaire’s tax evasion
HSBC, one of the world’s largest financial institutions, helped wealthy clients in many countries of the world to avoid hundreds of millions of dollars in taxes to the treasury.
An investigation by the BBC’s Panorama, who accessed some 106,000 accounts of wealthy customers in 203 countries, concluded that HSBC would not only help to avoid paying taxes on large swathes of the wealthy, but also to avoid being caught by the law.
The documents were leaked in 2007 by a computer expert bank in Geneva.
According to research by Panorama, the report contained data on 7,000 clients domiciled in the UK, many of whom hid their fortunes to the British Treasury.
HSBC issued a statement on Monday stating that they have since changed their activities “fundamentally”, although now face criminal investigations in the United States, France, Belgium and Argentina.
However, in this country, no lawsuit was launched against the company.
On Monday afternoon, Parliament was summoned for an emergency debate on tax evasion by HSBC, ordered by Labour MP Shabana Mahmood.
“We need to understand whether the British Treasury presented cases before the Public Prosecutor, and if the latter refused to raise charges. These are issues that the government must clarify,” said parliamentary opposition.
Offshore accounts are not illegal per se, but many people use them to hide money from the tax authorities.
From India, the Finance Minister Arun Jaitley, confirmed that all Indian citizens involved will be investigated in the list of clients of HSBC, but warned that some accounts could be legitimate.
For its part, the French authorities concluded in 2013 that 99.8% of its citizens in the list probably evaded taxes.
The thousands of pages of documents were obtained by the French newspaper Le Monde, and investigated jointly by several media outlets, including The Guardian in Britain, the BBC, The Nation of Argentina and the International Consortium of Investigative Journalists.
From the UK, the British Treasury had received the list in 2010 and identified about 1,100 people who had evaded the treasury.
But five years later, only a single tax evader was prosecuted for that crime.
HMRC said it raised at least £135 million in taxes, interest and penalties for those who hid their fortunes in Switzerland.
However, the president of the Parliamentary Public Accounts Committee, Labour’s Margaret Hodge, concluded that the tax authorities of the country “were not strong enough, efficient, courageous and firm to get the money owed to the tax was paid.”
The debate is now focused on the then director of HSBC Stephen Green, who was later appointed curator Lord and received the minister of trade and investment, which met until 2013.
Green was appointed minister only eight months after the British Treasury received the leaked documents from HSBC.
He now faces being questioned by Parliament.
After the scandal – just three months before the general elections – Minister for the Treasury, David Gauke, defended the appointment of Lord Green, and said there was no evidence “to suggest that the official was involved in illegal activities.”
For more on the latest financial and tax news, look up The Cheap Accountant now!