SHARE
COPY LINK

TAX EVASION

Nina Ricci heiress jailed in ‘SwissLeaks’ case

A Paris court on Monday sentenced Nina Ricci's heiress to a year in prison and handed her a million-euro fine for tax fraud involving a Geneva bank, in the first ruling against a famous figure in the SwissLeaks scandal.

Nina Ricci heiress jailed in 'SwissLeaks' case
Arlette Ricci jailed for fraud linked to a Geneva bank. Photo: AFP

The court said Arlette Ricci, 73, had hidden some €18.7 million ($19.8 million) she inherited from her father from the French taxman "for more than 20 years with particular determination."

It also confiscated properties in Paris and Corsica, estimated to be worth around four million euros ($4.2 million).

The French designer's glamorous granddaughter was not present in court for the verdict, but denies the charge that she hid the money by depositing it in the Geneva-based HSBC Private Bank.

Authorities are also demanding Ricci pay back some €10.5 million ($11 million) in unpaid taxes, penalties and fines.

Ricci was given a two-year suspended sentence on top of her jail term, which she would only have to serve if she re-offends.

The court also handed her tax lawyer a one-year suspended sentence and ordered him to pay a €10,000 ($10,575) fine, while giving her daughter an eight-month suspended sentence for tax fraud.

The Nina Ricci house was founded in 1932 in Paris, and is known for its luxury perfumes — especially the floral classic L'Air du Temps — and its classic, slender fashion lines.

The case against Arlette Ricci began after revelations that the Swiss private banking arm of British giant HSBC had helped clients hide billions from the taxman, in what became known as the SwissLeaks scandal.

The court said the heiress's actions had posed "an exceptional threat to public order".

Crackdown on fraud

Ricci's lawyers slammed the decision, and said they would wait for the full details before deciding whether to appeal.

"Justice was done under frenetic, brutal pressure . . . by the prosecution," Jean-Marc Fedida said, adding he thought the aim was to have a high-profile defendant "as a sort of warning to all those whom we think have accounts abroad."

In February, the prosecution had demanded Ricci be handed a two-year jail term and a €3 million ($3.2 million) fine.

During the trial, the defence team had regularly questioned the French authorities' reliance on stolen documents supplied by former HSBC IT employee Herve Falciani.

But the court systematically overturned their procedural complaints.

France has vowed to crack down on tax cheats, particularly after a major scandal in 2013 saw former budget minister Jerome Cahuzac charged with tax fraud.

Cahuzac, who had been tasked with fighting tax evasion, was found to have an undeclared Swiss bank account containing some €600,000 ($635,000).

In February, France's Le Monde and other international newspapers revealed that HSBC's Swiss arm allegedly helped over 120,000 clients to hide €180.6 billion ($193.6 billion) from tax authorities.

The findings came among growing evidence that pledges by banks to halt illicit or irresponsible activities that led up to the 2008 financial crisis have not been fulfilled.

HSBC said last week it was facing a French criminal probe over the allegations.

According to the investigations into Falciani's whistle-blowing data, HSBC's Swiss unit allegedly arranged for more than €5 billion ($5.3 billion) to be tucked away in trusts, shell companies and offshore accounts for around 9,000 French clients.
 

Member comments

Log in here to leave a comment.
Become a Member to leave a comment.

TAX EVASION

Switzerland’s banks remain among the world’s most secretive

Despite the progress made over the years, the Swiss financial sector continues to be one of the least transparent in the world. But there is good news too.

Switzerland’s banks remain among the world’s most secretive
Switzerland remains one of the world's least transparent nations. Photo AFP

Switzerland is in the third place in the 2020 Financial Secrecy Index released by the non-governmental organisation (NGO) Tax Justice Network (TJN), which rates 133 nations based on their financial transparency.

Two other European countries, Luxembourg and the Netherlands, are also ranked among the top 10 least transparent nations on the TJN’s list.

Despite being in the third place, Switzerland ranks better this year than it did in the previous edition of the Index, which is released every two years — it slipped from the first to third place. The Cayman Islands and the United States took the first and second spots, respectively.

Switzerland reduced its risk of being an offshore haven for tax cheats by 12 percent, “finally improving enough to move off the top of the index”, TJN said. 

READ MORE: Switzerland's strangest taxes – and what happens if you don't pay them

This improvement is mainly due to Switzerland extending its international network for the automatic exchange of customer information to more than 100 countries. 

Also, in a referendum held last year, Swiss voters accepted the Federal Act on Tax Reform and AVS Financing (TRAF). This legislation introduced major changes in the Swiss tax system by ending some preferential tax schemes and replacing them with new regulations which are in line with international standards.

This tax reform prompted the European Union to change Switzerland's status from ‘tax haven' to one which is EU-compliant, removing strict controls on transactions within the EU. 

So why, despite all the reforms, does Switzerland still rank among the world’s least transparent nations?

According to a Swiss NGO Alliance Sud, wealthy people from poor countries can still hide their money here from the tax authorities of their home nations.

Alliance Sud noted that despite the progress made in the past years by Swiss financial institutions, “the fight against tax evasion remains insufficient”.

Switzerland is the world’s biggest centre for managing offshore wealth, with a quarter of global assets invested here.

For years, it has been placed on various lists of tax havens where wealthy foreigners could park their money. Faced with widespread criticism for this practice, Switzerland passed an anti-money laundering law in 1997 and introduced strict regulations against tax evasion.
 

 

 
 

 

SHOW COMMENTS