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The Banking Giant That Helped the 1% Hide Billions in Taxes

February 10, 2015 in Blogs

By Cliff Weathers, AlterNet

The banking giant used secret Swiss accounts to help the world’s wealthiest people evade taxes.

HSBC, the world’s second largest bank, helped some of the richest people in the world stash away billions in assets to avoid taxes. The Swiss arm of the British banking giant encouraged wealthy clients to hide their fortunes from governments and other taxing authorities and helped to make their transactions untraceable.

A group of media organizations, including the BBC, The Guardian, LeMonde, and the International Consortium of Investigative Journalists obtained documents revealing the complex tax dodge scheme.

The documents reveal that HSBC’s exclusive Swiss bank allowed rich clients to withdraw bricks of cash in various foreign currencies to hide such transactions. The bank also conspired with clients in creating undeclared “black” accounts to hide their wealth from domestic taxing authorities. Moreover, this service was aggressively marketed by HSBC bankers to uber-rich clients, including wealthy heirs, unethical financiers, business executives, Hollywood stars, European royalty and even global crime figures.

In one recording obtained by journalists, an HSBC Swiss banking manager gives advice to a British financier and his partner, showing them how they could use their account to cheat on Italian taxes. Another document reveals that HSBC bankers were assisting “blood diamond” dealer Emmanuel Shallop with hiding his income from Belgian tax authorities and evading taxes. Other memos show that bankers turned a blind eye to a client withdrawing numerous cash bundles of Danish Kroner, while acknowledging that the activity was illegal.

The obtained files cover three years, 2005-2007 and reveal the activities of more than 30,000 secret bank accounts containing nearly $120 billion in assets.

HSBC has admitted to “past failures” but says that it has reformed.

“We acknowledge that the compliance culture and standards of due diligence in HSBC's Swiss private bank, as well as the industry in general, were significantly lower than they are today,” the bank said in a statement. HSBC also said that it is “cooperating with relevant authorities.”

According to HSBC, the Swiss banking arm had not been fully integrated with …read more

Source: ALTERNET

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