HSBC strikes first French deferred prosecution deal

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Dec 13, 2017
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The deal with HSBC in Switzerland involved a €300 million tax evasion case

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The Swiss branch of HSBC became the first company to strike a deferred prosecution agreement in France as a Paris court approved a deal in a €300 million tax evasion case.

Criminal proceedings against the bank triggered negotiations with the National Financial Prosecutor’s Office over a deal that is similar to the four agreements concluded by the Serious Fraud Office in the UK over the past two years.

Lawyers for the bank at the City of London practice Allen & Overy emphasised that the French settlement, which was agreed last month but published yesterday, did not involve any admission of guilt or criminal liability.

Deferred prosecution agreements were created in France through legislation last year. Denis Chemla, a Paris-based partner at Allen & Overy, described the first agreement as a milestone.

“It should serve as a benchmark for a variety of groups under investigation for corruption, influence peddling, money-laundering or tax evasion and related criminal offences, Chemla said.

The order validating the deal was issued by the president of the Tribunal de Grande Instance de Paris after a public hearing. It acknowledges the dismissal of the laundering of tax evasion proceeds and illicit banking solicitation charges brought against HSBC’s Swiss private banking operation.

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