UBS Swiss Bank faces a French court ruling on fraud charges

Time:2019-03-26 12:32:22 Popular: Comment:0


UBS Swiss Bank faces a French court ruling on fraud charges


Paris court will decide Wednesday whether Swiss banking giant UBS illegally tried to persuade French clients to hide billions of euros in Switzerland, prompting prosecutors to seek a record fine of 3.7 billion euros.


After seven years of investigation, the experiment began last autumn when several former employees filed charges of illegal acts.


This is because European authorities as a whole have cracked down on tax evasion and suspicious banking after the global financial crisis that broke out in 2007.


Pressure eventually forced Switzerland to effectively end its established tradition of bank secrecy by joining more than 90 countries, which agreed to automatically share more customer account information with each other.


In UBS's case, the French authorities determined that tax officials retained more than 10 billion euros between 2004 and 2012.


The National Financial Prosecutor's Office is demanding compensation of 3.7 billion euros, the largest fine ever imposed by France, saying the bank and its directors "know very well that they have violated French law" by illegally recruiting customers and helping them evade French taxes.


They also recovered 15 million euros from UBS's French subsidiary and offered up to 500,000 euros to six executives, including Raoul Weil, former vice president of UBS, and Patrick de Fayet, former second executive, for their French operations.


In addition, the plaintiff's lawyer in the French case seeks compensation of 1.6 billion.


UBS, which was ordered to bail out 1.1 billion euros, denied the allegations and said its business was in accordance with Swiss law.


It also said that it was "unaware" that some French clients had failed to declare assets in Switzerland and that prosecutors had not provided any evidence, such as customer names or accounts, to support their fraudulent claims.


Industry executives are watching the case closely when Paris and other European capitals hope to attract multinational banks from London when the UK breaks out of Europe.

UBS Swiss Bank


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