UBS faces trial in France over tax allegations
UBS faces criminal trial in France after failing to agree a settlement with prosecutors over allegations it helped wealthy clients to evade tax authorities.
The Swiss bank said the group and its French unit have been told that the investigative judges from PNF, the national financial prosecutor’s office, havedecidedtotakethecasetocourt.
“We will now have the possibility to respond in detail in a court of law,” the banksaidinastatementyesterday.
“UBS has made clear that the bank disagrees with the allegations, assumptions and legal interpretations being made,” it added. “We will continue to strongly defend ourselves and look forwardtoafairproceeding.”
PNF has suggested that UBS pays at least €1.1bn, an amount that corresponds to a figure the Swiss bank has already paid as a court bond as part of the dispute, according to people briefed on the failed talks. But UBS has been pushing for a figure closer to the €300m it had to pay in 2014 to German authorities over a similar investigation into whether it helped German clients evade taxes, according to the people.
The investigative judges ordered that UBS be tried for alleged “illegal banking” as well as “aggravated money laundering and tax fraud”, according to a PNF spokesman. They also ordered a trial for five senior bank officials in FranceandSwitzerland.
The PNF has estimated that some €9.76bn worth of fraudulent money was held by UBS on behalf of French individuals, according to one person briefed on its probe. If the bank loses at trial, the fine may amount to “up to half of the value or funds involved in laundering operations”, according to the French CriminalCode.
The PNF has recently launched several high-profile investigations, including one into embezzlement allegations against François Fillon, the centre-right presidential candidate. The DoJ’s move makes it the latest regulator to drop its investigation into the forex business of Germany’s largest lender, after the US Commodity Futures Trading Commission ended its own probeinOctoberlastyear.
Thedecisioncomestwoyearsaftersix global banks — Barclays, Citigroup, JPMorgan, Royal Bank of Scotland, UBS and Bank of America — reached a $5.6bn deal with US and UK authorities