HSBC has had a tough week. Not only has it had to tell investors that the bank experienced a 17% plunge in profits before tax for 2014, its boss was also dragged into the Swiss bank account scandal.
Details emerged over how HSBC’s CEO Stuart Gulliver “sheltered £5 million of his own money at a Panamanian company with Swiss HSBC account.”
Although Gulliver was not accused of evading tax and the real, ridiculous reason for him hiding of his money in a foreign account was revealed, he and HSBC’s Chairman Douglas Flint will have to explain what is exactly going on to British politicians.
At 2:15 p.m. GMT (10:15 E.T) today, Flint and Gulliver will join a range of officials from the UK tax authority, HMRC, to give evidence to the Treasury Select Committee over the
tax evasion and money laundering scandal, which followed after whistleblower Herve Falciani leaked of thousands of Swiss bank accounts to a range of European authorities.
“The Committee is concerned about allegations involving HSBC and its Swiss private bank,” Andrew Tyrie, chairman of the Treasury Select Committee in a press statement.
“Banks have repeatedly told the Committee that, since the crisis, they have put in place reforms to ensure that they operate on the basis of sharply improved standards. The Committee will need reassurance that they have done so in private banking.”
Falciani handed over 100,000 HSBC client accounts to French authorities in 2008. In total, the accounts are worth £78 billion in assets. Since then, France, Spain and the UK have recovered over £500 million in tax from the data.
HMRC’s CEO Lin Homer, and two other high ranking tax officials will also have to answers questions over handling of the bank account data leak.
In 2010, the UK’s HMRC received details regarding the bank account of about 1,000 Britons who were accused of evading taxes by using the HSBC Swiss subsidiary.
However, HMRC did not tell the Financial Conduct Authority of the documents, citing an “international treaty agreement” with France for prohibiting it from passing on details to anyone outside the tax authority.