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Don Weinland

Banking giant HSBC yesterday denied charges from Argentina's tax bureau that it had helped citizens in the South American country evade an estimated US$3 billion in taxes, the latest on a growing list of accusations against the bank.
"HSBC emphatically denies its participation in any illegal association, including any organisation that allows depositing capital outside Argentina to evade taxes," the bank told the South China Morning Post in an emailed statement.
Argentina's AFIP tax agency on Thursday charged the local branch of HSBC and its executives in an Argentine federal court.
AFIP head Ricardo Echegaray said Argentine citizens evaded about US$3 billion in taxes that were handled by intermediaries through a network of offshore accounts, including Switzerland.
He alleged that some accounts in Geneva were owned by HSBC Argentina's president and other bank executives. He did not say if the bank's operations had been suspended in Argentina.

In a statement to the Associated Press, the bank said that HSBC Argentina did not have an account in HSBC Switzerland.
Analysts said the bank could avoid spooking investors by keeping the cost of the case low.
"As long as the fine is not more than US$500 million, I don't think it will move [the share price]," said Dominic Chan, an analyst at BNP Paribas in Hong Kong.
The charges are the latest regulatory headache for the bank, which has come under fire in several jurisdictions on a wide range of accusations.
AFIP said it got its information from France, where HSBC was placed under formal investigation last week for possibly aiding tax evasion. The bank has also been charged in Belgium with organised fiscal fraud.
HSBC has made substantial provisions in recent years, much of which relate to regulatory probes for wrongdoing. Provisions for the third quarter totalled US$1.69 billion, a 115 per cent spike year on year, the bank said earlier this month. The bank marked out US$378 million for a foreign exchange probe launched by Britain's Financial Conduct Authority.
HSBC also prepared to pay out US$701 million in the third quarter to compensate customers under British consumer redress programmes, a continuing cost for the bank.
In mid-September, HSBC agreed to pay US$550 million to resolve claims that it misled US government housing corporations Fannie Mae and Freddie Mac about mortgage securities it sold them before the 2007 collapse of the US housing market.
"There will continue to be redress and fines that come through," chief executive Stuart Gulliver said during a call with investors and analysts this month.


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HSBC

Argentina accuses HSBC in US$3b tax evasion cases

AFIP head Ricardo Echegaray (centre) said AFIP charged the local branch of HSBC and its executives in an Argentine federal court. Photo: Ricardo Echegaray's official website

The HSBC lion stands guard outside the bank's Hong Kong offices in the Central business district. HSBC was accused by Argentina's tax authority of helping up to 4,000 citizens evade taxes by placing the money in Swiss bank accounts. Photo: AP

French HSBC tax case report reveals US$5b in Swiss funds

HSBC says a former employee stole data which revealed the names of people holding money at its Swiss arm. Photo: SCMP

Business

Banking & Finance

Bank's executives charged over citizens avoiding US$3b in levies


HSBC denied charges from Argentina's tax bureau that it had helped citizens evade US$3 billion in taxes, the latest on a growing list of accusations against the bank.
