Authorities raid major French banks in EUR 100 bln fraud investigation

Thursday 30 March 2023 09:10 CET | News

French authorities have conducted multiple raids on five major banks in the country as part of an investigation into possible fiscal fraud and money laundering, according to Finbold


Authorities in France launched multiple raids on BNP Paribas, Société Générale, Exane, Natixis, and HSBC to investigate fiscal fraud and money laundering.


The banks in question include BNP Paribas, Société Générale, Exane, Natixis, and HSBC. The probe is linked to the legally questionable ‘cum/cum’ practice, in which banks create complicated legal structures to allow wealthy clients to get around the taxation of dividends. The investigations are suspected to be connected to a case that may have cost the French and German governments over EUR 100 billion (USD 108 billion).

The raids were carried out by 16 investigating judges and over 150 investigation agents, and involved six prosecutors from the western German city of Cologne. The banks in question are suspected of aggravated tax fraud laundering, while BNP and Exane are facing suspicions of aggravated tax fraud. The investigations began in December 2021 and required several months of preparation, according to a statement by the French Financial Prosecutor’s Office.

The ‘cum/cum’ practice became more widely known after the 2018 ‘CumEx files’ – a reporting project led by the German investigative newsroom Correctiv, which revealed how banks were able to create complicated structures to help clients avoid paying taxes on dividends. The banks involved in the current investigation are suspected of using similar practices.

More about the global banking crisis

The banking sector around the world is still recovering from the aftermath of several major banks collapsing within days of each other or coming close to their demise, which has made the industry very vulnerable, according to the chairperson of the European Banking Authority (EBA), José Manuel Campa. This has resulted in significant inflows of capital into Bitcoin (BTC), which has reportedly surpassed Visa and JP Morgan Chase in market capitalisation. Some analysts are comparing the current situation to the 2008 financial crisis and predicting that it could be even worse than the Great Recession.

Recently, Steve Boms, Founder and President of Allon Advocacy and Executive Director of FDATA North America, shared valuable insights into the collapses of Silvergate, SVB, and Signature Bank and how US regulators prevented the crisis from spreading. We encourage you to read the article to find out more.

Following the collapse of Silicon Valley Bank, US-based regulators approved its acquisition by rival First Citizens Bank. In Europe, Credit Suisse avoided a meltdown after the Swiss government encouraged its rival UBS to purchase it.

More: Link

Free Headlines in your E-mail

Every day we send out a free e-mail with the most important headlines of the last 24 hours.

Subscribe now

Keywords: banks, money laundering, tax evasion
Categories: Banking & Fintech
Countries: France
This article is part of category

Banking & Fintech