British Revenue Chief Is Faulted on HSBC’s Efforts to Aid Tax Evasion

LONDON – The chief executive of Britain’s tax agency was questioned by politicians over leaked documents that describe how HSBC’s Swiss private banking arm helped clients, including politicians, rock stars and dealers of illicit diamonds, hide billions of dollars before 2007.

Members of Parliament criticized Lin Homer, the chief of Her Majesty’s Revenue and Customs, for not extracting more prosecutions or recovering more money from tax evasion suspects.

Much of the HSBC information has been available to officials for several years. But the documents became public when the International Consortium of Investigative Journalists released them on Sunday. They describe how HSBC employees had told clients that the bank would not report details of their accounts to their home tax authorities. The employees also outlined options for how clients could avoid paying taxes on those assets.

On Wednesday, The Guardian outlined investment plans that the bank had sold to clients that allowed them to avoid the European Union Savings Directive, a 2003 attempt to counter cross-border tax evasion.

In Parliament, politicians attacked Ms. Homer’s agency for not being aggressive enough after French authorities presented the HSBC data to Britain in 2010 with certain restrictions. One of those restrictions was that the tax agency not share the data with other law enforcement authorities.

Facing bitter accusations and interruptions, Ms. Homer conceded that those restrictions had been lifted, and that her agency could investigate the allegations of money laundering. She also said that she would meet with other British law enforcement agencies this week to discuss the data.

The documents were taken from HSBC by a former employee in Switzerland in 2007 and given to French authorities, who in 2010 shared them with Britain, Spain and the United States, among other nations.

Ms. Homer reiterated that her agency had used the data from 2010 to collect more than 135 million pounds, or $206 million, in back taxes and penalties. She added that the government had increased the maximum penalty an individual faces for hiding money overseas to 200 percent of the tax evaded.

The agency considered prosecuting 150 people but referred only three cases to prosecutors, who won one conviction.

“It is very difficult to prosecute from offshore,” Jennie Granger, the tax agency’s director general of enforcement and compliance, testified. “One of the challenges — and particularly in a situation when you have stolen data, which is what this is — is that you have to be able to prove those facts another way.” in order for the C.P.S. to be able to take it forward.” She was referring to the government’s Crown Prosecution Service.

But Margaret Hodge of the Labour Party, chairwoman of the public accounts committee, called the revelations from the leaks “outrageous.”

“It’s the first time in many of these leaks that we have seen strong allegations of egregious tax avoidance or tax evasion,” she told Ms. Homer. “I cannot for the life of me begin to understand your pathetic response.”

HSBC said in a statement Wednesday that it had overhauled its procedures.

“We have taken significant steps over the past several years to implement reforms and exit clients who did not meet strict new HSBC standards, including those where we had concerns in relation to tax compliance,” the bank said in a statement on Wednesday.

The publication of names of people who held accounts with HSBC in Switzerland, and who have donated money to both main British political parties, became a political wedge issue in the House of Commons on Wednesday.

The leader of the opposition Labour Party, Ed Miliband, said that the list included seven donors to the Conservative Party, led by Prime Minister David Cameron, adding that there was a “revolving door” between his party headquarters and the Swiss branch of HSBC.

Mr. Cameron this week publicly defended his appointment in 2010 of Stephen Green, the former chairman of HSBC, as Britain’s trade minister. Mr. Green, a Conservative member of the House of Lords, was trade minister for several years.

Mr. Green has not commented on the new revelations.