UBS goes on trial in France over alleged tax fraud

UBS’s trial in France follows a similar judicial process in the US where the bank accepted in 2009 to pay $780 million in a settlement. (AFP)
Updated 08 October 2018
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UBS goes on trial in France over alleged tax fraud

  • The largest Swiss bank risks fines of up to €5 billion
  • The bank intends to stand its ground in court

PARIS: Swiss bank UBS Group , its French unit and six top executives go on trial on Monday after a long-running investigation into allegations they helped wealthy clients avoid taxes in France.
After years of investigation and aborted settlement negotiations, UBS faces charges of aggravated tax fraud and money laundering as well as illegally soliciting clients in France.
The largest Swiss bank risks fines of up to €5 billion ($5.76 billion).
The bank intends to stand its ground in court. “After more than six years of legal proceedings, we will finally have the opportunity to respond to the often-unfounded allegations,” it said on Friday.
Banks became more rigorous after the 2008 financial crisis, a series of financial scandals at some of the world’s biggest banks and the imposition of tighter regulations, analysts say.
UBS’s trial in France follows a similar judicial process in the United States where the bank accepted in 2009 to pay $780 million in a settlement. In Germany, UBS agreed to a 300 million euro fine in 2014.
During the French investigation, UBS turned down a settlement offer of €1.1 billion made by the authorities. The amount corresponded to what the Swiss bank had already paid as a court bond, according to judicial sources.
Most of the trial’s first week will be spent on dealing with technicalities likely to be brought up by the defendants’ lawyers.
The investigation into UBS in the US began after UBS employee Bradley Birkenfeld revealed a scheme to funnel wealthy customers’ cash from the United States to Switzerland bypassing the US taxman.
Birkenfeld spoke separately to French investigators. Even though he is not due to testify in court in Paris he will attend the hearings.
The whistleblower told Reuters that he hoped for a stiff penalty for the Swiss bank. “If they set an example with UBS, most other banks will be scared,” he said.
For money laundering, French criminal law lets judges enforce fines as high as half of the amount laundered. In the French case, prosecutors estimate that up to €10.6 billion was denied to the taxman.


Brent eases from 2019 highs as markets await US-China trade talks outcome

Updated 19 February 2019
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Brent eases from 2019 highs as markets await US-China trade talks outcome

  • The slight downward correction was driven by concerns about the health of the global economy this year
  • Bank of America Merrill Lynch expects Brent prices to average between $50 and $70 per barrel

SINGAPORE: Brent crude oil prices eased away from 2019 highs on Tuesday on caution that economic growth may dent fuel demand this year, although supply cuts led by OPEC still meant markets were relatively tight.
International Brent crude oil futures were at $66.08 per barrel at 0220 GMT, down 42 cents, or 0.6 percent from their last close, but still not far off the 2019 high of $66.83 a barrel hit in the previous session.
US West Texas Intermediate (WTI) crude futures were at $55.71 per barrel. While that was up 12 cents from their last settlement, it was below the $56.33 2019 high from the previous day.
Traders said the slight downward correction was driven by concerns about the health of the global economy this year.
Bank of America Merrill Lynch said in a note that the Sino-American trade dispute was hurting economic growth globally.
“Addressing global trade tensions is key for improving the economic outlook,” it said in a note.
China’s vice premier and chief trade negotiator, Liu He, and US Trade Representative Robert Lighthizer lead a round of trade talks this week in Washington.
Considering the economic outlook and supply and demand balances, the bank said it expects Brent prices to average between $50 and $70 per barrel, “anchored around $60.”
Despite some caution around trade, global oil markets remain relatively tight because of supply cuts led by the Organization of the Petroleum Exporting Countries (OPEC), with top crude exporter Saudi Arabia cutting the most.
Saudi seaborne crude exports fell in the first half of February, with departures standing at 6.204 million barrels per day (bpd), a 1.341 million bpd decline on the previous month and 0.91 million bpd decline on the year, data intelligence firm Kpler said.
Further providing oil markets with support are US sanctions against petroleum exporters Iran and Venezuela.
Venezuela is a major crude supplier to US refineries while Iran is a key exporter to major demand centers in Asia, especially China and India.