ZURICH/MILAN: UBS looks set to agree a 100 million euro ($113 million) settlement of a money laundering and tax case in Italy within the next few weeks, according to people familiar with the matter, in contrast to a similar case in France.
Switzerland’s biggest bank is battling a number of court cases in Europe over claims it enabled cross-border tax cheats to hide assets in Switzerland.
In France it opted to challenge a charge of tax evasion, with a resulting penalty of 4.5 billion euros awarded against the bank in February. UBS has denied wrongdoing and is appealing the decision.
Its handling of that case led to a rare rebuke of the bank’s management by shareholders. French authorities had initially discussed a penalty of 40 – 100 million euros, provided the bank admit guilt.
“UBS never had an option to settle without either admitting guilt, which would have been unprecedented at the time, or paying billions of Swiss francs,” the bank said in a statement.
In Italy, sources are saying it is close to clinching a settlement with the country’s tax authority, which could help the Swiss bank receive lighter treatment from local prosecutors.
The investigation is on standby pending settlement.
Prosecutors in Milan opened their investigation in early 2018 into alleged money laundering and failure to file tax returns after receiving documents from Germany’s customs agency about the Swiss bank’s Italian clients, an investigative source told Reuters.
UBS flagged the matter in its 2018 annual report, saying tax authorities and a prosecutor’s office in Italy had asserted it might be liable for taxes and penalties as a result of its activities from 2012 to 2017.