UBS Spared $2 Billion Fine After French Supreme Court Calls for New Tax Fraud Trial -- Update
16 November 2023 - 3:39AM
Dow Jones News
By Mauro Orru and Pierre Bertrand
UBS Group won't have to pay around $2 billion after the French
Supreme Court partly overturned a decision from a lower court that
had fined the bank in a long-running tax-fraud case, but confirmed
a ruling that the bank had helped wealthy clients in France evade
taxes.
The latest ruling, announced Wednesday by the Supreme Court,
effectively rescinds the financial penalties imposed on UBS in
December 2021.
At the time, a Court of Appeal had levied a fine of 3.75 million
euros ($4.1 million) on the bank, the confiscation of EUR1 billion,
and awarded civil damages of EUR800 million to the French state,
which UBS appealed.
Wednesday's decision can't be appealed as it comes from the
highest court in France. However, the Supreme Court said in its
ruling that it would send the case back to the Paris Court of
Appeal to reconsider potential penalties on the elements of the
case that were overturned.
UBS said it acted in accordance with all applicable laws and
regulations at all times and that it would defend itself in the
forthcoming trial.
"While UBS is pleased that the highest court in France agrees
with its position on these important aspects of the legal case, UBS
is disappointed that the French Supreme Court has confirmed the
previous court decision regarding unlawful client solicitation and
aggravated laundering of the proceeds of tax fraud despite the
treaty between Europe and Switzerland on the taxation of savings
income and a lack of specific evidence for the alleged facts," the
bank said in a statement.
The Zurich-based bank and some former employees have been under
investigation in France since 2013. Back in 2019, a court of first
instance had imposed a fine of EUR3.7 billion on UBS and ordered
the bank to pay EUR800 million in damages to the French government
for lost tax revenue. That fine was subsequently reduced by the
Court of Appeal in 2021.
UBS said in its latest financial report that its balance sheet
at the end of September had provisions of EUR1.1 billion in
relation to the tax case, a figure that it said reflected its best
forecasts of possible financial implications.
At 1602 GMT, UBS shares traded 2.3% higher to CHF22.61.
Write to Mauro Orru at mauro.orru@wsj.com and Pierre Bertrand at
pierre.bertrand@wsj.com
(END) Dow Jones Newswires
November 15, 2023 11:24 ET (16:24 GMT)
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