BARK & COSOLICITORS

IN LONDON

It has recently come to our attention that two Britons have been arrested on suspicion of using Swiss Bank accounts held with HSBC to evade UK taxes. This could lead to the first criminal prosecutions in a three year clampdown on offshore tax evasion by HMRC.

According to our source, HMRC made the arrests late last year and both individuals have been released on bail pending charges. These arrests are thought to have resulted from the review of the information stolen from HSBC’s private bank in Zurich by Herve Falciani, a French software engineer, which contained account information pertaining to 6,600 accounts held by UK residents.

 

This significant development once again underlines HMRC’s desire to stamp out tax evasion linked to funds retained in offshore accounts and signals a hardening of HMRC’s attitude. News of these arrests may counter the concerted criticism of HMRC’s crackdown on tax evasion. Some commentators have accused the taxman of shying away from mounting criminal prosecutions and the deterrent message that they convey to the tax-paying population. We will of course keep you updated on this development.

In a similar vein, news reached us yesterday that the whistle-blowing website WikiLeaks has been provided with a raft of information concerning 2,000 wealthy individuals and corporations that held accounts with Bank Julius Baer in the British Virgin Islands tax haven. Rudolf Elmer, who was previously employed by Julius Baer to oversee the Caribbean operations of the Swiss Bank for eight years until he was dismissed in 2002, handed over the discs to WikiLeaks founder Julian Assange during a press conference. Mr Assange has promised to publish the details once the information has been verified. WLH understands that WikiLeaks is taking legal advice on what information they can release, but it is likely that the website will not hold back as evidenced during previous high profile “leaks.”

Rudolf Elmer is currently standing trial accused of coercion and breaching banking secrecy laws in Switzerland and his motive in supplying this information is to expose mass potential tax evasion. He told the Observer newspaper last weekend that those named in the documents come from “the US, Britain, Germany, Austria and Asia, and include business people, politicians, people who make their living in the arts and multinational companies-from both sides of the Atlantic.” It is unclear whether HMRC has been passed this information, however it is clear that the taxman will be monitoring developments very closely. It is also likely that those individuals who might be affected and have tax issues stemming from the ownership of such accounts may be seeking urgent professional advice.

This development reinforces the message that if you have an undeclared offshore account, then you should come forward voluntarily and resolve the issue before HMRC comes calling. It is no longer an option to bury your head in the sand and hope it will all go away.

We will update this story as it develops, however should you require any further information, please do not hesitate to get in touch