Peter Braunwalder, the former CEO of the Swiss private bank HSBC, has pleaded guilty to helping some wealthy clients hide assets worth at least 1.6 billion euros. Braunwalder, 69, has been fined 500,000 euros and has received a one-year suspended prison sentence that was suspended, according to the court ruling from Paris, dated January 29.
The banker admitted helping his clients evade taxes between 2006 and 2007 by opening clandestine bank accounts in Switzerland and establishing trusts abroad or granting false loans, according to reports in Bloomberg. The former HSBC executive also pleaded guilty to illegally approaching French residents to encourage them to transfer funds to Switzerland during the same period.
The French authorities began investigating HSBC after Herve Falciani, a former systems engineer at the company, stole details of the tax evasion of many bank clients in 2008 and shared the data with investigators.
The so-called “Falciani list” identified at least 127,000 bank accounts belonging to 79,000 people from 180 countries.
The French government estimated that “at least 1,670 million euros” of taxes were fraudulently evaded with the help of the bank.
In November 2017, HSBC Private Bank, agreed to pay a €300 million in order to avoid going on trial on the same charges.
The Swiss bank, UBS, also began negotiations in France in June 2016 to enter into a Public Interest Judicial Convention (CJIP), which is a procedure under French law that allows persons or entities accused of corruption to reach a settlement with prosecutors without pleading guilty.
However this was rejected by the French courts and the bank was ordered in February to pay a fine of 4.5 billion euros, 800 million of which was due to the French State in damages. The bank appealed the judgment.