Greek investigators have raided the home of a former local boss of UBS as part of a widening investigation into suspected tax evasion.
The raid on Christos Sclavounis’ Athens residence on July 4 is the latest attempt by cash-strapped European nations to pierce the secrecy of Swiss banks in the hope of boosting depleted coffers. Police took away computers, documents and disks, according to people with knowledge of the raid.
Mr Sclavounis was UBS’s head of investment banking in Greece until his appointment by a centre-right government in May 2013 as chair of the Hellenic Financial Stability Fund, a rescue fund for the country’s stricken banks. He resigned in March 2015, two months after Alexis Tsipras’ leftwing Syriza party took power. Mr Sclavounis, who has not been charged, declined to comment.
The Greek investigation is based on account information from UBS’s Geneva branch contained on a CD that German authorities bought in 2012 and subsequently shared with Athens. By cross-checking account numbers and dates of birth on that list with domestic records of transfers abroad, Greek investigators compiled a list of 1,000 suspected tax evaders, people familiar with the investigation said. Some have already agreed settlements, these people added.
Investigators are also probing the role of UBS and its bankers. They hope to access more account information from UBS’s offices in Zurich and Lugano and also its operations in Luxembourg and Singapore.
UBS, the biggest Swiss bank by assets, said: “We have not been contacted by Greek authorities concerning an alleged investigation of UBS.” The bank declined to comment further.
UBS said earlier this month that it had been instructed by Swiss authorities to hand over information relating to a number of accounts held by French taxpayers after a request from Paris. The bank said it “expects other countries to file similar requests”. It added that under new rules that come into force next year all Swiss banks will be obliged to share tax information.
UBS has spent the past decade contending with the fallout from its complicity in tax evasion.
In July 2008, a US Senate committee published a report that revealed for the first time many of the techniques Swiss banks used to hide money. Much of the information came from Bradley Birkenfeld, a former UBS banker.
In 2009, UBS reached a deal with US prosecutors under which, in exchange for avoiding criminal charges for helping Americans evade tax, the bank paid a $780m fine.
Mr Birkenfeld served two-and-a-half years in a US prison for his role in the tax evasion scheme. But shortly after his release in 2012 he received $104m in the largest payout to date under a US scheme that rewards whistleblowers.
The outspoken ex-banker let it be known that he was willing to assist other governments that suspected UBS might have deprived them of tax revenue. Athens approached him and last month he swore what he says was an “extensive” affidavit at the Greek embassy in Washington.
Mr Birkenfeld told the Financial Times that he had described in his statement how UBS bankers worked to encourage clients in countries such as Greece to use the bank’s financial secrecy services, which typically involved setting up front companies, numbered accounts and trusts.
Everyone knew, if you were referring clients back to Switzerland, they were not going there to buy chocolate
– Bradley Birkenfeld, former UBS banker turned whistleblower
“Everyone knew, if you were referring clients back to Switzerland, they were not going there to buy chocolate,” Mr Birkenfeld said. He added: “Greece is an economic shambles. Why? Because all of their money’s in Geneva and Zurich.”
Mr Birkenfeld’s information dates from 2005, when he left the bank. But following a raid on UBS’s office in Athens in December, Greek investigators suspect the bank continued to target Greeks until capital controls were imposed in June 2015 amid fears that the country was about to crash out of the euro.
The Syriza government has this year stepped up efforts to pursue wealthy Greek alleged tax evaders who keep their funds in Switzerland, partly to bolster revenues but also to enhance the government’s leftwing credentials at a time when Greeks have been hit hard by fresh pension cuts and tax rises.
The finance ministry is drafting a bill on voluntary disclosure that would allow Greeks with bank accounts abroad to declare untaxed assets and pay a fine to avoid prosecution on criminal charges of tax evasion and money laundering. The bill is expected to be approved by parliament next month.
2005 Bradley Birkenfeld leaves his job as a banker at UBS, where he had helped wealthy Americans hide their money from the US tax authorities
2008 US senator Carl Levin’s investigative committee publishes a report, based in part on evidence from Birkenfeld, that lays out in detail for the first time the tricks Swiss bankers used to conceal clients’ money
2009 As part of a deal with US prosecutors to avoid criminal charges, UBS agrees to pay a $780m fine and to hand over details of American clients, blowing a hole in the Swiss tradition of banking secrecy
2012 Authorities in the German state of North Rhine-Westphalia buy a CD containing details of UBS accounts containing assets worth SFr3.5bn ($3.6bn). UBS pays €300m to settle with the German state in 2014, but Germany also shares the information with other countries, including France and Greece, triggering further probes
2013 US announces its “Swiss bank programme” under which institutions that helped Americans evade tax can escape a criminal prosecution by coming forward, revealing details of their activities and clients, and paying a fine. Eighty banks cut deals, paying a total of $1.4bn. Global moves to increase tax co-operation between nations accelerate
2016 After previous Greek governments were lambasted for their failure to pursue suspected tax evasion revealed in a leak from HSBC’s Swiss bank, the authorities step up a probe into UBS’s activities in the country based on the German data
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