New penalties could be introduced for aiding tax evasion
Last week, the Financial Conduct Authority (FCA) announced it would investigate claims that HSBC had helped wealthy clients avoid paying millions of pounds worth of tax.
The financial watchdog revealed it was cooperating closely with the firm and other agencies involved in the matter, and would focus on issues relating to the current practices and culture of the bank.
In the wake of the political fallout over the allegations, chancellor George Osborne has suggested further financial penalties could be introduced for those who aid and abet tax evasion.
“Ahead of the budget I set the Treasury to work on providing further ways to pursue not just the tax evaders but those providing them with advice,” he told MPs in the House of Commons.
“Anyone involved in tax evasion, whatever your role, this government is coming after you. Unlike the last government, who simply turned a blind eye, this government is taking action now and will do so again at the budget.”
A government source later confirmed the Treasury was looking into bringing in new penalties for the offence.
Two HSBC bosses this week apologised for the “unacceptable” practices that took place at the Swiss arm of the bank between 2005 and 2007.
Group chief executive Stuart Gulliver and chairman Douglas Flint were answering questions from MPs belonging to the Treasury Select Committee.
Mr Flint admitted the bank has suffered “horrible reputational damage” as a result of the revelations.
HSBC recently revealed it suffered a 17 per cent fall in its pre-tax profits to £12.1 billion in 2014. The bank has been involved in a number of scandals, including foreign exchange manipulation and the rigging of international interest rate benchmarks.
The latest allegations came to light after former employee Herve Falciani leaked details relating to 130,000 tax evaders who had accounts with HSBC’s Swiss arm.
FCA Martin Wheatley told a Treasury select committee that “significant improvements” have been made by the bank since the 2005-07 period.
