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HSBC Holdings Plc must pay a Euro 1-billion ($1.1 billion) bail after being charged in a French criminal probe into tax evasion at its private bank, three months after the same unit drew fresh scrutiny in the UK.
HSBC on Wednesday was informed it was placed under formal criminal investigation regarding its private bank's conduct in 2006 and 2007. The move came five months after HSBC's Swiss unit was charged and ordered to post a Euro 50-million bail.
The decision is "without legal basis and the bail is unwarranted and excessive," HSBC said in a statement on Thursday from London, adding it will appeal. French President Francois Hollande has increased efforts to punish tax evasion since his former Budget Minister Jerome Cahuzac was forced to resign after his secret Swiss account was exposed.
UBS Group AG, Switzerland's largest bank, was forced to pay a Euro 1.1-billion security deposit last year to cover potential penalties in a separate French tax-evasion probe after its appeals failed. Judges estimated the Zurich-based bank helped French taxpayers hide about Euro 9.8 billion.
France began scrutinizing HSBC's Swiss private bank after Herve Falciani, a former information technology worker at the firm, stole client account details from HSBC's Geneva office in 2008 and passed them to the French government.
