Court Refuses to Drop Money Laundering Charge Against UBS, $5.8 Billion Fine Looms
A French court has reportedly rejected a request by the largest Swiss bank to drop money laundering charge against it. UBS Group and a number of its executives are accused of tax fraud and money laundering. If found guilty, the bank could be fined up to 5 billion euros or $5.8 billion. Its executives could also face jail time.
UBS Wants Money Laundering Charge Dropped
The tax fraud and money laundering trial in France of UBS Group AG and its executives began last week after seven years of investigation.
The largest bank in Switzerland with offices in over 50 countries has asked for the French constitutional court to “drop money laundering charges and limit proceedings to complicity in tax fraud, which carries lighter penalties,” Reuters reported Thursday. However, the court rejected this request, noting that the bank’s arguments were “devoid of seriousness,” the news outlet detailed, elaborating:
UBS Group AG, its French unit and six executives and former executives face charges of aggravated tax fraud and money laundering in an investigation into allegations they helped wealthy clients avoid taxes in France.
Up to 5 Billion Euros Fine Plus Damages
During the investigation, UBS Group turned down the authorities’ settlement offer of 1.1 billion euros, the publication conveyed. “The amount corresponded to what the Swiss bank had already paid as a court bond, according to judicial sources.” The news outlet further described:
If found guilty of money laundering, UBS could be fined up to 5 billion euros ($5.8 billion). French criminal law lets judges enforce fines as high as half the amount laundered and in this case prosecutors estimate that up to 10.6 billion euros was denied to the French tax authorities.
According to Reuters, the bank could also face damages awarded to the French tax authorities for the missing revenue and the executives risk jail time.
The whistleblower told the publication that he hoped for a stiff penalty for Switzerland’s largest bank, stating that “If they set an example with UBS, most other banks will be scared.”
In 2009, UBS went through a similar trial in the U.S. and paid $780 million in settlement. In 2014, the bank was on trial in Germany and paid 300 million euros in fines.
Recently, a number of other megabanks have been under fire for alleged money laundering activities. Denmark’s largest bank, Danske Bank, allegedly engaged in money laundering through its Estonian branch that could total 200 billion euros. The probe into Danske Bank has also implicated Citigroup and Deutsche Bank. Last month, Netherland’s largest retail bank, ING Group, was fined $900 million for money laundering. News.Bitcoin.com also recently reported that Nordic region’s largest bank, Nordea, was suspected of money laundering.