HSBC pays €300m to settle Belgian tax fraud case

Pedro Gonçalves
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HSBC pays €300m to settle Belgian tax fraud case

HSBC's Swiss private banking arm agreed to pay nearly €294m ($329m) to settle a Belgian criminal probe into allegations it helped wealthy clients dodge hundreds of millions of euros in taxes, Belgian prosecutors said.

The Brussels prosecutor's office was able to reach a settlement partly because of a "change in the wealth management within HSBC", and it noted the bank had stopped certain offshore services, improved transparency and appointed an anti-fraud director.

The prosecutor's office had accused the company in 2014 of massive organised fiscal fraud, money laundering and forming a criminal organisation to the benefit of more than 1,000 wealthy clients that cost the Belgian authorities "hundreds of millions of euro". It is believed that most of these clients were active in the Antwerp diamond business.

They alleged that HSBC helped and encouraged the avoidance of the EU savings tax by creating off-shore companies in Panama and other tax havens in the Caribbean for wealthy Belgian clients "with no other purpose but to hide money".

The settlement comes after a French court in February ordered UBS to pay €4.5bn in penalties for illegally soliciting clients and laundering the proceeds of tax evasion.

The preliminary agreement in Belgium's largest criminal settlement still needs to be approved by a judge at a hearing that should take place in September.

 

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