HSBC files: tax chief 'confident' civil servants told ministers about data
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Version 0 of 1. Britain’s most senior tax official told MPs she was confident civil servants told ministers in 2010 about a tranche of data that uncovered avoidance and evasion at HSBC’s Swiss bank. Lin Homer, the chief executive of HMRC, made the disclosure at a bad-tempered public accounts committee on Wednesday, during which her department was accused of failing to serve British taxpayers’ interests. Homer, who was appointed to lead the tax authority in 2012, said she believed officials would have told government ministers within months of receiving the data in April 2010. Related: The HSBC files: What we know so far “We are confident we will have told ministers that we were about to receive a big tranche of operation information,” she said. Her disclosure will prompt further questions about which, if any, ministers were made aware of the claims and whether they were acted upon. At the first appearance of senior tax officials since the Guardian uncovered evidence within the files, Margaret Hodge, the chair of the committee, questioned why revenue officials had secured only one prosecution. She highlighted a number of “missed opportunities” by HMRC inquisitors to examine a list of 6,800 UK-related accounts provided in 2010 by French authorities. Hodge said it appeared that activities related to the Geneva branch of HSBC’s Swiss subsidiary were “pretty outrageous” and told Homer that tax investigators should have spoken to whistleblower Hervé Falciani, who initially obtained the list while employed as an IT worker in 2007. Homer insisted staff in her department had been diligent in their approach to the files and said their record of securing one conviction and £135m in unpaid tax, fines and interest compared well with other countries. Hodge replied that the French tax authorities had recouped £200m from 3,000 named account holders and the Spanish £180m from 2,900. (Figures have revealed that France has recovered £188m in taxes while Spain has clawed back £220m in taxes and fines.) “It’s the first time in many of these leaks that there are really strong allegations not of egregious tax avoidance but of tax evasion, and that is incredibly serious. “For you to sit there and say, as you are doing, that ‘We couldn’t get the money in in the same way as the French and Spanish did’ and ‘We didn’t litigate because we wanted to get the money in’ and yet you did worse on the money – it leaves me believing that you are not serving the British taxpayer,” Hodge said. Homer disagreed. She said 300 staff had been sifting through the data and had traced 3,200 individuals, including 150 most serious cases which could be considered for criminal prosecution, 500 of which were more serious but not likely to meet the criminal threshold, and 400-500 which could be pursued for disclosure and settlement. Hodge told Homer tax officials should have been seeking to speak to Falciani and obtain a copy of his file as soon as it was known about. In fact, the whistleblower said in 2013 he had not been contacted by the UK tax authorities, and his offer to provide the files was not taken up, she said. HMRC officials have also failed to speak to the Guardian or the BBC’s Panorama programme about any of their evidence, too, she added. “One of my feelings of anger with you is that you sit there waiting for people to come,” said Hodge. “You don’t go out and police in the way other authorities are doing and therefore they are getting more money in and more litigation.” Homer responded that tax officials have been proactive. Officials were now contacting the BBC and the International Consortium of Investigative Journalists in relation to new information, she said. Hodge warned Homer that she expects to see Homer’s deputy, Edward Troup, who has previously spoken before parliament of his knowledge of the Swiss files, at a committee meeting next month which will further examine the HSBC allegations. Referring to a statement from HMRC released on Wednesday morning which said that Troup would not be attending, Hodge said: “It is not for you who appears before this committee, it is for us to decide who we will see. We will expect Edward Troup when we meet here on 4 March and we really hope that we will not have to take further action.” MPs grew increasingly frustrated with the restricted nature of HMRC’s inquiry and the authority’s inability to pass on evidence of HSBC wrongdoing to other bodies such as the bank regulator or the Serious Fraud Office. Homer said: “I would just ask you to understand that we are only in a very limited way regulators of the bank in relation to their tax activity ... I am not the regulator of the banks.” An HMRC official said that the authority could not pass on information from the Swiss HSBC disc because of a tough agreement with the French tax authority. “We probably asked this question when the data first came in in 2010 and have asked again more recently. We did not have the freedom to pass it on for other purposes,” the official said. Hodge said HMRC’s failure to pursue prosecutions in favour of settlements was sending “a really rotten message” to wealthy investors. “You are saying: ‘It’s a risk worth taking – the worst that can happen to you if HMRC can be bothered to catch up with you, is that you may have to pay, you won’t have a prosecution, you won’t have any shame, you won’t be an example to anybody else, you’ll get away with it,’” said Hodge. A spokesman for No 10 said that ministers were aware in 2010 of the release of information pertaining to individual HSBC account holders, but never of claims of wrongdoing within HSBC. “At no point were ministers made aware of any suggestion of wrongdoing by HSBC itself. Ministers are responsible for the tax law and resourcing HMRC’s enforcement of that law. So questions about activities between 2005 and 2007 are for those who were ministers at the time,” he said. Lin Homer: tax chief in eye of storm Lin Homer’s stormy appearance in front of MPs is far from the first time that the veteran of a three-decade civil service career has been in the eye of a political storm. Less than 12 months ago, she was battling to keep her job as chief executive of the HMRC after MPs said they had little confidence in her abilities following a “catastrophic leadership failure” in her former role in charge of Britain’s immigration system. Born in Norfolk in 1957, she qualified as a solicitor and rose rapidly through the ranks of local government, working at Reading, Hertfordshire and Suffolk. However, a stint as chief executive of Birmingham city council ended in controversy, with sharp criticism of her handling of a postal vote rigging scandal. She became the first chief executive of the UK Border Agency (previously the Immigration Agency) before becoming permanent secretary at the Department for Transport in 2010 and chief executive at HMRC in January 2012. Married with three daughters, she lists her hobbies in Who’s Who as skiing, alpine walking and gardening. |