SHARE
COPY LINK

TAX EVASION

HSBC data leaker trial starts in his absence

A former HSBC employee who leaked documents alleging the bank helped clients evade millions of dollars in taxes failed again to show up for his Swiss trial Monday, which opened in his absence.

HSBC data leaker trial starts in his absence
Ex-HSBC employee Hervé Falciani at press conference in France last week. Photo: Jean-Philippe Ksiazek/AFP

Hervé Falciani, a 43-year-old French-Italian national who exposed the so-called Swissleaks scandal, has repeatedly said he would not travel to Switzerland for the trial and already failed to show for his initial court date last month, so his absence did not come as a surprise.
   
“I am not going,” Falciani told reporters in Divonne-les-Bains, France, just a stone's throw from the border with Switzerland, last week, questioning the possibility of obtaining a fair trial.
   
The federal court in the southern Swiss town of Bellinzona noted as the proceedings opened around 8am Monday that Falciani was absent, the ATS news agency reported.
   
After a short recess, the trial resumed and will continue in his absence.
   
As a French national living in France, he cannot be extradited to Switzerland.

Falciani faces criminal charges in Switzerland for unauthorized data procurement, economic espionage and violation of business secrets, in addition to breaching Swiss banking secrecy laws.   

The first witnesses in the case are due to be called to the stand on Tuesday, starting with the police officers who investigated Falciani's case and current and former employees of the HSBC Geneva branch.
   
One of his former girlfriends, who lives in Lebanon, also figures on the witness list, although it is not clear if she would show up.
   
Falciani leaked a cache of documents allegedly indicating that HSBC's Swiss private banking arm helped more than 120,000 clients to hide 180.6 billion euros ($205.4 billion) from the tax authorities.
   
He became an IT worker for HSBC in 2000 and moved to the bank's offices in Geneva in 2006.
   
The so-called “Snowden of tax evasion” and “the man who terrifies the rich” obtained access to a massive database of encrypted customer information, which was passed on to European fiscal authorities.
   
While he is viewed as a whistleblower and hero in countries where his leaked information is helping to net tax cheats, the Swiss authorities remain intent on prosecuting him.
   
Falciani has accused HSBC of pressuring Swiss authorities to move forward with the case against him.
   
Geneva prosecutors in June closed their investigation into HSBC's alleged wrongdoings after the bank agreed to pay tens of millions of dollars in compensation.
   
Geneva lead prosecutor Yves Bertossa at the time explained that “it is difficult to prove acts of money laundering. That is why we preferred to go with a negotiated solution.”

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