German prosecutors raid UBS offices in Frankfurt

German prosecutors have carried out searches of UBS premises in Frankfurt as part of a wider investigation into possible tax evasion by up to 2,000 clients of the Swiss bank, UBS confirmed to International Investment today.

The raids began on Tuesday and carried on until yesterday afternoon. Around 130 prosecutors and investigators for the German city of Bochum attended, but no files or documents were seized, a spokesperson for UBS said.

The spokesperson added that no UBS employees were under any suspicion of having acted illegally and that UBS was giving every assistance to the authorities.

Ongoing probe into 2,000 clients

The move comes as part of an ongoing probe into the tax affairs of UBS clients by German authorities. The latest search involves some 2,000 clients whose details were on a database bought by prosecutors in the German state of North Rhine-Westphalia.

It’s not the first time that German tax authorities have bought discs with details of UBS clients, and in 2014 UBS paid €300m (£262m) to settle claims by authorities in Bochum, the same jurisdiction that has carried out this week’s raids, that the bank had helped German clients to avoid paying tax.

Firefighting on all fronts

It comes at a time of increased lawsuits for UBS, which shut down its wealth management division in Luxembourg following accusation by prosecutors that German citizens were not disclosing assets held there.

Meanwhile in France, UBS embroiled in tax-fraud proceedings that could see the bank landing a hefty fine by the French government, reputed to be up to €4.9bn (£4.3bn), dwarfing a €1.1bn eurobond posted in early 2014.

The bond was supposed to cover any liabilities that should arise but talks between UBS and the French government have broken down irreconcilably, leading to the present court action.

The Bloomberg news service notes that UBS is not the only Swiss bank under investigation in Germany for allegedly helping its citizens evade taxes.

Credit Suisse Group AG and Julius Baer Group Ltd, it points out, settled in 2011 for 150 million euros and 50 million euros respectively.

When International Investment asked UBS to comment, they declined but provided the following statement:

Statement

  • The investigation of the German authorities is not related to a criminal or civil proceeding against UBS.
  • No documents were confiscated during the search yesterday.
  • UBS has completed a tax compliance program with clients based in Europe. The bank was among the first in the industry to take this step requiring documentation of tax disclosure by its clients.

 

ABOUT THE AUTHOR
Eugene Costello
Eugene Costello has been a journalist for some 20 years, and has written for a wide variety of UK and international newspapers and magazines.

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