Swiss Accounts More German HSBC Clients Revealed

Almost twice as many Germans as previously thought had an account at a Swiss subsidiary of international bank HSBC, which could face prosecution in Germany for possibly aiding tax evasion.
German clients had accounts with HSBC's Swiss private bank subsidiary, according to an investigation.

As many as 2,106 people with a link to Germany had - and could possibly still have - an account at a HSBC Private Bank Geneva, according to investigative reporting  by German newspaper Süddeutscher Zeitung and broadcasters NDR and WDR.

The findings, which were released late Monday and are part of a study by the International Consortium of Investigative Journalists, could lead to more investigations into to possible tax evasion by German citizens.

The group has revealed more than 100,000 account holders from over 200 countries at the Swiss subsidiary of HSBC, which is headquartered in London.

More than 2,000 Germans had about €3.3 billion, or $3.7 billion, in Swiss HSBC accounts from a period extending up to 2007, the German media reported.

I think such practices should be investigated and, if appropriate, punished with all the available means the tax code provides. Sigmar Gabriel, German vice-chancellor and economics minister

According to bank data given to German authorities in 2010, only 1,136 German people had a Swiss HSBC account in 2007 or before, and some of these account holders have been prosecuted in Germany.

The Swiss HSBC private bank subsidiary could be subject to prosecution, Sigmar Gabriel, Germany’s economics minister and vice chancellor, told German radio station NDR Info.

“I think such practices should be investigated and, if appropriate, punished with all the available means the tax code provides,” Mr. Gabriel said.

HSBC spokesman Morgan Bone in London declined to specifically comment on the German numbers or Mr. Gabriel’s statement. Mr. Bone said HSBC was cooperating with authorities and referred to a written statement by the bank.

The Swiss HSBC private bank subsidiary has “undergone a radical transformation in recent years” and the bank “has implemented numerous initiatives designed to prevent its banking services being used to evade taxes or launder money,” the statement said.

Norbert Walter-Borjans, the finance minister of the state of North Rhine-Westphalia, told German newspaper Ruhr Nachrichten that tax crimes should be punished harder.

Having an account at the Swiss private bank of HSBC does not mean an accountholder is evading taxes.

“Income must be reported to finance authorities," Mr. Walter-Borjans said in the interview. "And banks that do not give up the business model of organized fraud once and for all must reckon with license revocation.”

Having an account at the Swiss private bank of HSBC does not mean the holder is necessarily evading taxes. If a German citizen, for instance, declares the HSBC assets with German tax authorities and pays a wealth tax if applicable, the savings are considered legal in Switzerland.

So far, only a small number of the known 1,136 German account holders have been investigated for possible tax evasion. The southwestern state of Baden-Württemberg, for example, received 112 data sets in early March 2011, which were "of course, evaluated," said a spokesman for the state finance ministry in Stuttgart. Investigative proceedings were initiated in nine cases.

“Anyone who commits tax evasion can expect to deal with the long arm of the law,” Baden-Württemberg Finance Minister Nils Schmid, a member of the center-left Social Democratic Party (SPD), told Handelsblatt.

Mr. Walter-Borjans described the data as "valuable." This has not always been the case. In the city-state of Hamburg, 110 HSBC cases were reviewed but none led to an investigation.

According to the investigative reporters,  the new HSBC findings were based on data French authorities had obtained in 2009. The HSBC data originally came from a former bank IT employee, Herve Falciani, who had handed it over to French authorities.


Gilbert Kreijger is an editor with Handelsblatt Global Edition in Berlin, covering companies and markets. Donata Riedel has worked for Handelsblatt for 20 years and writes about economic policy. Volker Votsmeier is an editor with Handelsblatt's investigative reporting team. Katharina Slodczyk also contributed to this article. To contact the author:  [email protected][email protected] and [email protected]