HSBC Whistleblower Gets 5 Years

HSBC whistleblower given five years’ jail over biggest leak in banking history

Hervé Falciani sentenced in his absence for financial espionage by federal court for exposing wrongdoing at HSBC’s private Swiss bank Juliette Garside   @JulietteGarside Friday 27 November 2015 17.47 GMT Last modified on Friday 27 November 2015 22.43 GMTThe whistleblower who exposed wrongdoing at HSBC’s Swiss private bank has been sentenced to five years in prison by a Swiss court. 

Hervé Falciani, a former IT worker, was convicted in his absence for the biggest leak in banking history. He is currently living in France, where he sought refuge from Swiss justice, and did not attend the trial.

Hervé Falciani
Hervé Falciani has sought refuge in France. Photograph: Denis Balibouse/Reuters
The leak of secret bank account details formed the basis of revelations – by the Guardian, the BBC, Le Monde and other media outlets – which showed that HSBC’s Swiss banking arm turned a blind eye to illegal activities of arms dealers and helped wealthy people evade taxes. 

While working on the database of HSBC’s Swiss private bank, Falciani downloaded the details of about 130,000 holders of secret Swiss accounts. The information was handed to French investigators in December 2008 and then circulated to other European governments.It was used to prosecute tax evaders including Arlette Ricci, the heir to France’s Nina Ricci perfume empire, and to pursue Emilio Botín, the late chairman of Spain’s Santander bank. Switzerland’s federal prosecutor had requested a record six-year term for Falciani for aggravated industrial espionage, data theft and violation of commercial and banking secrecy.It was the longest sentence ever demanded by the confederation’s public ministry in a case of banking data theft. The trial was also the first conducted by the country’s federal criminal court in which the accused had not been present.

The defendant’s lawyers had demanded a reduced sentence, of between two and three years, “compatible with the granting of a reprieve”. 

Falciani himself refused to appear in the dock, on the grounds that he would not be allowed a fair trial. He described the process as a “parody of justice”.

HSBC Hid Millions For Drug Traffickers

Swiss scandal: HSBC hid millions for drug traffickers, arms dealers and global celebs

http://www.news.com.au/finance/business/swiss-scandal-hsbc-hid-millions-for-drug-traffickers-arms-dealers-and-global-celebs/story-fnkjidjt-1227214307166

SECRET documents published online alleging banking giant HSBC helped wealthy customers dodge millions of dollars in taxes caused global shock waves Monday and spotlighted the financial dealings of the world’s ultra-rich.

The cache of files made public in the so-called SwissLeaks case included the names of celebrities, alleged arms dealers and politicians — though inclusion on the list is not proof of any wrongdoing.

The documents published at the weekend claim the London-based bank’s Swiss division helped clients in more than 200 countries evade taxes on accounts containing $A151 billion (104 billion euros).

The huge cache of files from Europe’s biggest bank was stolen by an IT worker in 2007 and passed to French authorities, but had not been previously made public.HSBC’s Swiss banking arm insists it has undergone a “radical transformation”.
HSBC’s Swiss banking arm insists it has undergone a “radical transformation”. Source: Getty Images

The International Consortium of Investigative Journalists (ICIJ) obtained the files via French newspaper Le Monde and shared them with more than 45 other media organisations worldwide.

The documents showed that HSBC opened Swiss accounts for international criminals, businessmen, politicians and celebrities, according to the ICIJ.

The revelations renewed calls for a crackdown on sophisticated tax avoidance by the wealthy and multinational companies. Tax avoidance is legal, but tax evasion is not.

“HSBC profited from doing business with arms dealers who channelled mortar bombs to child soldiers in Africa, bag men for Third World dictators, traffickers in blood diamonds and other international outlaws,” ICIJ reported.

FAMOUS NAMES

A range of current and former politicians from Russia, India and various African countries, as well as Saudi, Bahraini, Jordanian and Moroccan royalty, and the late Australian press magnate Kerry Packer were named in the files.

Following the bombshell disclosure, there were calls for a Swiss probe against the bank, which is already facing prosecution in France and Belgium.

Global fallout on Monday included a Belgian judge said to be considering international arrest warrants for directors of HSBC’s Swiss division, while in Britain a political row was triggered, with the main parties blaming each other for not taking action.

Shares in HSBC, whose reputation has been tarnished in recent years by a string of high-profile controversies, were down 1.64 per cent to 610.60 pence at the close of trading in London.

So far Switzerland has only launched an investigation against HSBC employee-turned-whistleblower Herve Falciani, who stole the files at the heart of the scandal.

In an interview on Monday, the ex-HSBC employee called for more protections for whistleblowers.

“If you want to counterbalance impunity, you have to provide the means to do so,” Falciani told Swiss public broadcaster RTS.

“I hope they will have enough energy left after investigating me for the past six years to investigate the bank.” The files were used by the French government to track down tax evaders and shared with other states in 2010, leading to a series of prosecutions.

British tax authorities said Monday they had brought in more than £135 million (181 million euros, $A263 million) on the basis of the files.

HSBC’s Swiss banking arm insisted it has since undergone a “radical transformation”.

“HSBC’s Swiss Private Bank began a radical transformation in 2008 to prevent its services from being used to evade taxes or launder money,” Franco Morra, the head of HSBC’s Swiss unit, told AFP in an email.

He said the bank had closed the accounts of clients “who did not meet our high standards” and had “strong compliance controls in place,” adding that the disclosures were “a reminder that the old business model of Swiss private banking is no longer acceptable.” The Swiss Banking Association said the country’s banks had worked hard in recent years to clean up shop.

HIDDEN MONEY?

Notes in the leaked files indicate HSBC workers were aware of clients’ intentions to keep money hidden from national authorities.

Of one Danish account holder collecting cash bundles of kroner, an employee wrote: “All contacts through one of her three daughters living in London. Account holder living in Denmark, i.e. critical as it is a criminal act having an account abroad non declared.” The files provide details on over 100,000 HSBC clients, including people targeted by US sanctions, such as Turkish businessman Selim Alguadis and Gennady Timchenko, an associate of Russian President Vladimir Putin.

Alguadis told the ICIJ it was prudent to keep savings offshore, while a spokesman for Timchenko said he was fully compliant with tax matters.

Other individuals named on the list include Rami Makhlouf, cousin of Syrian President Bashar al-Assad, designer Diane von Furstenberg, who told the ICIJ the accounts were inherited from her parents, and model Elle Macpherson, whose lawyers told the ICIJ she was fully in compliance with UK tax law.

Motorcycle racer Valentino Rossi, listed as having $A30.7 million in two accounts, said he had regularised his tax situation with Italian authorities.

Libor

Registered Business # CIK#: DUNS #:
Respondent T&C Ref: Other
Rothschild 36 Rothschild Bankers charged
US regulator sues 16 banks for alleged Libor rigging BBC News  A US regulator has sued 16 banks for allegedly manipulating the London interbank offered rate (Libor).
The Libor rate is used to set trillions of dollars of financial contracts, including mortgages and financial transactions around the world.
The regulator said the manipulation caused substantial losses to 38 US banks which were shut down during and after the 2008 financial crisis.
The sued banks include Barclays, HSBC, Citigroup and Royal Bank of Scotland.
Former UBS and Citigroup Trader charged over Libor BBC News

Former UBS and Citigroup trader Tom Hayes has been charged by the Serious Fraud Office (SFO) in connection with its investigation into the manipulation of Libor.

Mr Hayes, 33, has been charged with eight counts of conspiracy to defraud, and will appear before Westminster Magistrates’ Court on Thursday.