Court re­fuses UBS re­quest to drop money laun­der­ing charge

Gulf Times Business - - BUSINESS -

A French court on Thurs­day threw out a re­quest by Swiss bank UBS for the con­sti­tu­tional court to drop money laun­der­ing charges and limit pro­ceed­ings to com­plic­ity in tax fraud, which car­ries lighter penal­ties. UBS Group AG, its French unit and six ex­ec­u­tives and former ex­ec­u­tives face charges of ag­gra­vated tax fraud and money laun­der­ing in an in­ves­ti­ga­tion into al­le­ga­tions they helped wealthy clients avoid taxes in France.

Un­der French law, a de­fen­dant can on the first day of a trial raise ob­jec­tions to the case go­ing ahead on grounds that the con­sti­tu­tion has been flouted.

The court de­scribed the bank’s ar­gu­ments as “de­void of se­ri­ous­ness”. Af­ter seven years of in­ves­ti­ga­tion and aborted set­tle­ment ne­go­ti­a­tions, UBS will also an­swer al­le­ga­tions that it il­le­gally so­licited clients in France.

UBS, Switzer­land’s largest bank, said in a state­ment it still ex­pects the court will re-qual­ify the charges based “on the facts pre­sented and the law.”

“We be­lieve that the pros­e­cu­tion has not pre­sented any ev­i­dence to sup­port that a crime has been com­mit­ted,” the bank said. “We look for­ward to fi­nally be­ing able to present all of our fac­tual and le­gal ar­gu­ments to the court.”

If found guilty of money laun­der­ing, UBS could be fined up to €5bn ($5.8bn). French crim­i­nal law lets judges en­force fines as high as half the amount laun­dered and in this case prose­cu­tors es­ti­mate that up to €10.6bn was de­nied to the French tax au­thor­i­ties.

The bank could also face dam­ages awarded to the French tax­man for the miss­ing rev­enue, while its ex­ec­u­tives risk jail time.

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