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Argentina demands HSBC repay $3.5bn in offshore funds | Argentina demands HSBC repay $3.5bn in offshore funds |
(about 1 hour later) | |
The head of Argentina's tax authority has demanded that HSBC repatriate $3.5bn (£2.3bn) in funds that it says HSBC helped its clients move offshore. | The head of Argentina's tax authority has demanded that HSBC repatriate $3.5bn (£2.3bn) in funds that it says HSBC helped its clients move offshore. |
Ricardo Echegaray said that HSBC's actions threatened the stability of the Argentine government. | Ricardo Echegaray said that HSBC's actions threatened the stability of the Argentine government. |
"HSBC built a platform to help clients evade tax," said Mr Echegary in a press briefing at London's Argentine embassy. | "HSBC built a platform to help clients evade tax," said Mr Echegary in a press briefing at London's Argentine embassy. |
HSBC said it had "been cooperating fully with Argentine regulators, including AFIP (the tax authority"). | HSBC said it had "been cooperating fully with Argentine regulators, including AFIP (the tax authority"). |
It also said it was working with the Argentine judiciary, since the allegations were first made public last year, and it would continue to do so. | It also said it was working with the Argentine judiciary, since the allegations were first made public last year, and it would continue to do so. |
Mr Echegaray said British tax authorities had asked for details about Argentina's case against HSBC. | Mr Echegaray said British tax authorities had asked for details about Argentina's case against HSBC. |
"Without tax collection, there is no government, there is no public policy, there is no State, that is to say there is no country," said Mr Echegaray. | "Without tax collection, there is no government, there is no public policy, there is no State, that is to say there is no country," said Mr Echegaray. |
Expanding scope | Expanding scope |
Last November, Argentina accused HSBC of helping more than 4,000 clients evade taxes, but HSBC denied the charges, saying it respected Argentine law. | Last November, Argentina accused HSBC of helping more than 4,000 clients evade taxes, but HSBC denied the charges, saying it respected Argentine law. |
Nonetheless, Argentina filed a criminal complaint against HSBC for tax evasion and illegal tax association, which could carry prison sentences of up to 10 years. | Nonetheless, Argentina filed a criminal complaint against HSBC for tax evasion and illegal tax association, which could carry prison sentences of up to 10 years. |
As part of his briefing, Mr Echegaray further revealed that on 8 March, at the request of the Argentine tax authority, police raided HSBC's Argentine branch in search of documents. | As part of his briefing, Mr Echegaray further revealed that on 8 March, at the request of the Argentine tax authority, police raided HSBC's Argentine branch in search of documents. |
As part of that raid, Argentine authorities found documents indicating that most of the paperwork associated with the accounts were stored a firm called "Iron Mountain", which had been the subject of arson in February 2014. | As part of that raid, Argentine authorities found documents indicating that most of the paperwork associated with the accounts were stored a firm called "Iron Mountain", which had been the subject of arson in February 2014. |
Mr Echegaray also said that Argentine tax authorities had requested information from the tax administrations in the Virgin Islands, Uruguay and Bermuda, and that a new committee in Argentina's Congress had been set up to investigate whether other banks had used similar strategies to that of HSBC. | Mr Echegaray also said that Argentine tax authorities had requested information from the tax administrations in the Virgin Islands, Uruguay and Bermuda, and that a new committee in Argentina's Congress had been set up to investigate whether other banks had used similar strategies to that of HSBC. |
More questions | More questions |
Mr Echegaray's remarks came hours before several current and former HSBC executives answered questions from a panel of MPs about the tax scandal at HSBC's Swiss private bank. | Mr Echegaray's remarks came hours before several current and former HSBC executives answered questions from a panel of MPs about the tax scandal at HSBC's Swiss private bank. |
Analysis: Business editor, Kamal Ahmed | Analysis: Business editor, Kamal Ahmed |
The demand that HSBC "repatriates" $3.5bn in funds to Argentina - made today by the head of the Argentine equivalent of Her Majesty's Revenue and Customs (HMRC) - shows an approach which sharply contrasts with that of the UK tax authorities. | The demand that HSBC "repatriates" $3.5bn in funds to Argentina - made today by the head of the Argentine equivalent of Her Majesty's Revenue and Customs (HMRC) - shows an approach which sharply contrasts with that of the UK tax authorities. |
Ricardo Echegaray says that unless HSBC makes a public statement that it "respects" the payment of taxes it will be accused of engaging in "financial piracy". | Ricardo Echegaray says that unless HSBC makes a public statement that it "respects" the payment of taxes it will be accused of engaging in "financial piracy". |
He certainly wants a battle through the courts over the allegations that HSBC allowed clients to evade taxes via its Swiss private banking arm in 2006. | He certainly wants a battle through the courts over the allegations that HSBC allowed clients to evade taxes via its Swiss private banking arm in 2006. |
Criminal action is high on his list of priorities and he has named the people he thinks are guilty of aiding tax evasion. | Criminal action is high on his list of priorities and he has named the people he thinks are guilty of aiding tax evasion. |
Mr Echegaray also reveals that HMRC only contacted the Argentine authorities over the Swiss tax evasion allegations on February 13. | Mr Echegaray also reveals that HMRC only contacted the Argentine authorities over the Swiss tax evasion allegations on February 13. |
Although not commenting on whether this was suitably "tough", he does point out it was a different approach from that employed by the tax authorities of France, Italy and Spain. | Although not commenting on whether this was suitably "tough", he does point out it was a different approach from that employed by the tax authorities of France, Italy and Spain. |
He described each of those as "very active", saying they had "responded quickly". | He described each of those as "very active", saying they had "responded quickly". |
More from Kamal: HSBC - where does responsibility lie? | More from Kamal: HSBC - where does responsibility lie? |
HSBC group chief executive Stuart Gulliver, the former head of the bank's private banking division, Chris Meares, and BBC Trust boss Rona Fairhead, who formerly led HSBC's risk committee w for failing to take responsibility for lax oversight at the bank. | HSBC group chief executive Stuart Gulliver, the former head of the bank's private banking division, Chris Meares, and BBC Trust boss Rona Fairhead, who formerly led HSBC's risk committee w for failing to take responsibility for lax oversight at the bank. |
Margaret Hodge, the chair of the Public Accounts Committee, told the witnesses that HSBC appeared to be "rich in bureaucracy and very, very short on common sense". | Margaret Hodge, the chair of the Public Accounts Committee, told the witnesses that HSBC appeared to be "rich in bureaucracy and very, very short on common sense". |
She added: "When things go wrong in the public sector on your watch you resign. No one has deigned to accept responsibility." | She added: "When things go wrong in the public sector on your watch you resign. No one has deigned to accept responsibility." |