Credit Suisse, HSBC reject tax dodging allegations

Credit Suisse and HSBC dismissed suggestions they were actively using offshore structures to help clients cheat on their taxes.
Credit Suisse and HSBC dismissed suggestions they were actively using offshore structures to help clients cheat on their taxes. PHOTOS: REUTERS, BLOOMBERG

HONG KONG/SINGAPORE • Credit Suisse and HSBC, two of the world's largest wealth managers, yesterday dismissed suggestions they were actively using offshore structures to help clients cheat on their taxes.

Their comments came a day after a leak of four decades of documents from Panamanian law firm Mossack Fonseca, which specialises in setting up offshore companies. The documents showed widespread use of those instruments by global banks on behalf of their clients and triggered a raft of government investigations across the world.

France, Australia, New Zealand, Austria, Sweden and the Netherlands are among the nations that have commenced investigations.

Credit Suisse chief executive Tidjane Thiam said his bank was only after lawful assets.

"We as a company, as a bank, only encourage the use of structures when there is a legitimate economic purpose," said Mr Thiam, who took the helm at Switzerland's second-largest bank last year.

He acknowledged that the wealth manager does use offshore financial structures, but only for very wealthy customers with assets in multiple jurisdictions, and it did not support their use for tax avoidance or allow them without knowing the identities of all those concerned.

Separately, HSBC said the documents pre-dated a thorough reform of its business model.

"The allegations are historical, in some cases dating back 20 years, pre-dating our significant, well- publicised reforms implemented over the last few years," said Mr Gareth Hewett, a Hong Kong-based spokesman for HSBC.

HSBC and Credit Suisse were named among the banks that helped set up structures that make it hard for tax collectors and investigators to track the flow of money, according to the leaked documents from Mossack Fonseca.

REUTERS

A version of this article appeared in the print edition of The Straits Times on April 06, 2016, with the headline 'Credit Suisse, HSBC reject tax dodging allegations'. Print Edition | Subscribe