A Paris criminal court has held that UBS Group AG engaged in aggravated money laundering and tax fraud when it illegally worked to establish hidden Swiss bank accounts for its French customers to aid them avoid tax in France.
UBS, the largest private wealth management bank in the world, has been under investigation for its activities between 2004 and 2012, when lavish social and sporting events were held to attract potential customers. The Swiss bank sent employees to solicit wealthy executives or athletes during the events in France, urging them to place their money in Switzerland and helped them to avoid taxes France. The assets illegally concealed by French clients in Switzerland in 2004-2012 allegedly amounted some 10 billion euros ($10.75 billion).
With regard to such wrongdoing, the Tribunal de Grande Instance de Paris ordered the Swiss bank to pay a fine of €3.7 billion and an additional €800 million in civil damages to the French government. Under French law, the court was empowered to fine the bank up to half the proceeds involved in the money laundering. The decision set the fine at the level the prosecutors had requested but halved the amount requested for damages.
Besides the fine for the company, five of the six former UBS bankers on trial were convicted and given suspended sentences and fines. They were given a 6-18 months suspended sentence and fined from €50,000 to €300,000.
In response to the court decision, UBS issued a release stating that it strongly disagrees with the court's decision. In the bank's view, the decision is not supported by any concrete evidence and effectively applies French law in Switzerland, which undermines the sovereignty of Swiss law and poses significant questions of territoriality. UBS will appeal the decision and evaluate whether the written decision requires any additional steps, which will suspend the judgment of the trial court and lead to the case being retried in its entirety before the French Court of Appeals.
One of TPA’s technology partners Cygnet Infotech has developed a comprehensive VAT solution named R7VAT MTD, which is amongst others recently approved by HMRC for use by companies in the UK to automate and manage their VAT returns filing process but can also be used broadly within the EU.
7:00 AM - 8:00 AM Mexico, USA and Canada (MDT/CDT)
9:00 AM - 10:00 AM Brazil (BRT)
1:00 PM - 2:00 PM London (GMT)
2:00 PM – 3:00 PM Amsterdam (CET)
8:00 PM - 9:00 PM Beijin (CST)