London--A cache of secret bank files shows that HSBC's Swiss banking arm helped wealthy customers avoid taxes and hide millions of dollars, according to a report by a network of investigative journalists released Sunday.
The files, analysed by reporters in the International Consortium of Investigative Journalists (ICIJ), showed that British banking giant HSBC provided accounts to international criminals, corrupt businessmen, politicians and celebrities.
"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.
The files list a range of former and current politicians from Britain, Russia, India and a range of African countries, Saudi, Bahraini, Jordanian and Moroccan royalty, and the late Australian press magnate Kerry Packer.
The revelations are likely to stoke calls for a crackdown on sophisticated tax avoidance by the wealthy and by multinational companies, a key political issue in Britain and Europe.
Notes in the 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 3 daughters living in London. Account holder living in Denmark, i.e. critical as it is a criminal act having an account abroad non declared."
In another memo, an HSBC manager discusses how a London-based financier codenamed "Painter" and his partner could avoid Italian tax.
"The risk for the couple is, of course, that when they return to Italy the UK tax authorities will pass on information on them to the Italian tax authorities. My own view on this was that ... there clearly was a risk," the employee wrote.
HSBC did not immediately respond to a request for comment, but told the ICIJ: "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."
Richard Brooks, a former tax inspector, told the BBC: "I think they were a tax avoidance and tax evasion service. I think that's what they were offering."
AFP
