Swiss to pass information on HSBC accounts to U.S. tax agency

Tue Jul 26, 2016 10:18am EDT
 
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By John Miller

ZURICH (Reuters) - Switzerland said it plans to give information to U.S. tax authorities about accounts at HSBC Holdings Plc's (HSBA.L: Quote) Swiss private bank, as part of a U.S. investigation into tax evasion.

HSBC's Swiss unit has already paid tens of millions of dollars in fines after admitting substandard compliance on tax evasion and other issues.

The Swiss government said it made the announcement about its plans on Tuesday to alert HSBC account holders whom it has been unable to locate, and to give them the chance to lodge a legal appeal if they object to having their information sent to the U.S. Internal Revenue Service (IRS).

The move comes after the IRS asked Swiss tax authorities in April for assistance on HSBC Private Bank (Suisse) SA accounts held by Swiss-registered "domiciliary companies" with U.S. beneficial owners between 2002 and 2014.

The Swiss Federal Tax Administration said the IRS targeted HSBC accounts "where there is evidence that the U.S. beneficial owner exercised control, directly or indirectly, over the account in violation of corporate governance ... by withdrawing funds from the account for personal use."

HSBC said it was cooperating.

"Following an information request in April 2016 from U.S. authorities to the Swiss Federal Tax Administration (SFTA), the bank has provided certain files, mostly related to former clients, to the SFTA," said Lonnie Frisby, a spokesman for HSBC's Swiss private bank. "The Swiss authorities may forward part or all of this information to U.S. authorities in accordance with applicable laws and treaties. Anyone subject to this request has been notified."

The U.S. Department of Justice is also investigating Britain-based HSBC over its Swiss unit's role in helping wealthy U.S. citizens evade taxes.   Continued...

 
The HSBC logo is seen on a top roof of the main branch in Beirut, Lebanon July 25, 2016. REUTERS/ Aziz Taher