HSBC Whistleblower’s Revelations Create Political Turmoil in Great Britton

Following the leak of a massive cache of secret bank files, it emerged on Sunday that HSBC’s Swiss subsidiary helped wealthy customers hide millions of dollars’ worth of assets. While the information leaked has caused scandal in several countries, it has created political turmoil in Great Britton.

Background:

The leaked documents also revealed the Swiss arm of the bank had doled out untraceable funds and advised clients on how to best circumvent tax authorities across the globe. The HSBC files were obtained through an international collaboration of news outlets, including the Guardian, Le Monde, BBC Panorama and the International Consortium of Investigative Journalists. In late 2007, Hervé Falciani, an IT expert at HSBC’s Swiss bank, hacked into its customer files. He fled to France with police on his trail for breaching Switzerland’s rigid bank secrecy laws. The French authorities detained him, but refused to extradite him when they realized the data could identify thousands of French tax evaders.

The files revealed that HSBC’s Swiss banking arm had aggressively promoted schemes that could enable wealthy clients to dodge European taxes, and had colluded with others to hide undeclared accounts from tax authorities worldwide.

Britain’s tax authority, HMRC, received a list in 2010 from which it identified more than 1,000 tax evaders. More than £135m ($206m) was quietly recovered in repayments, but only one person was prosecuted. HMRC and political leaders in Great Britton now face mounting questions and criticism about how this was handled.

Articles on the turmoil the HSBC scandal has caused in Great Britton:

HMRC and MPs clash over appearance of top official

HSBC tax leaks: Three senior figures at scandal-hit bank donated £875,000 to the Tories

Political storm breaks out over HSBC tax scandal