Belgium investigates local UBS head for fraud

BRUSSELS (AFP) - The head of the Belgium office of Swiss banking giant UBS, struggling to restore its reputation after a series of scandals, is under investigation for fraud and money laundering, officials said on Thursday.

Mr Marcel Bruehwiler, head of UBS Belgium, is also suspected of belonging to a criminal organisation, the Brussels prosecutor's office said.

His home and those of several clients were searched early on Thursday, with the probe based on information from former UBS Belgium employees. Prosecutors gave no figures for the amount involved.

Later on Thursday, Mr Bruehwiler was due to appear in court which will decide whether he is to be detained for questioning.

UBS said in a statement that it fully respected the law and would tolerate "no activity meant to allow any client to get around their tax obligations." It added: "UBS is cooperating fully with the Belgian authorities."

The L'Echo daily said separately that UBS Belgium had helped wealthy clients move large sums of money to the bank's home base in Switzerland to avoid paying tax.

The bank is currently under investigation in France and Germany on similar charges and in 2009, it paid US$780 million (S$976 million) in fines and had to hand over the names of several thousand US clients to American authorities in a massive tax evasion probe.

UBS and many of its global peers have been rocked over the past few years by scandals over tax fraud, money laundering and rigging of key financial markets, leading to billions in fines.