France to hand back tax data to Switzerland

France will return client data stolen by a former employee of a Geneva branch of HSBC to Switzerland, a French justice official said.

France to hand back tax data to Switzerland

France will return client data stolen by a former employee of a Geneva branch of HSBC to Switzerland, a French justice official said, in a bid to ease tensions that could undermine an accord to fight tax evasion.

An official from the justice ministry in Paris said magistrates in the southern city of Aix-en-Provence would hand over the data, which was seized as part of an investigation into possible money laundering.

"The decision was taken today to return the data as soon as possible," a ministry spokesman said. "The judges have confirmed with (Justice Minister) Michele Alliot-Marie that there was no impediment to their being returned."

France's use of the data has triggered a serious clash with Switzerland and threatened a bilateral taxation agreement that would ease the country's strict banking secrecy laws.

French tax authorities have been using the information prosecutors secured earlier this month from Herve Falciani, a former HSBC computer specialist, who has admitted to stealing client data from HSBC's private banking arm in Geneva.

Swiss authorities, which had asked France to secure the information, demanded the return of the data as a condition of ratifying a tax treaty aimed at making it easier for Paris to get at money salted away by French taxpayers in Swiss bank accounts.

However, the French budget ministry said the decision to hand over the data would not affect its clampdown on potential tax evaders with bank accounts in Switzerland.

Points open

The Swiss finance ministry said it "took note" of the decision to hand over the data but the matter had still not been resolved completely.

"As far as the double taxation agreement is concerned, some points remain open," a ministry spokeswoman said in emailed comments.

"The essential question is what France is prepared to do with the data. Switzerland will need to clarify this with France at the political level."

A global crackdown on tax havens in recent years has forced Switzerland to relax its treasured bank secrecy regime.

The country promised in March it would enter new tax treaties that would allow it to share bank client information in some cases of tax evasion.

France and Switzerland signed one such treaty in August, which was meant to be ratified by Swiss parliament in 2010.

Switzerland had demanded the return of the data by Dec. 25 and said it could suspend ratification of the treaty.

Among the computer data French prosecutors got from Falciani was a list of 130,000 HSBC clients, 3,000 of them French.

Tax authorities have requested individuals on the list to clarify their tax situations, saying the names could be passed to prosecutors by the end of the year if they did not respond.

Also on Monday, HSBC rejected claims by Falciani that it ignored his warnings on the data he took in 2006 and 2007.

Reuters
Last Mod: 21 Aralık 2009, 21:01
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