HSBC to pay $53M after Swiss bank tax evasion scandal

HSBC will pay 40 million Swiss francs ($53 million Cdn) to settle an investigation into allegations its Swiss private bank helped rich clients avoid taxes.

The bank said in a statement that no criminal charges would be filed and that it had changed its internal control procedures to prevent further abuse.

• HSBC's private bank in Switzerland used by several Canadian billionaires
• HSBC documents show bank helped clients hide billions from tax man

The fine settles its probe with Swiss authorities, in a solution the Geneva prosecutor said would pre-empt "the uncertainties of a long and complex legal case."

HSBC's Swiss arm is still facing investigations by U.S., French and Belgian authorities.

The investigation unfolded after an ex-employee leaked a list of thousands of suspected tax evaders with private Swiss accounts to French authorities in 2008.

The International Consortium of Investigative Journalists and news organizations dug through the files and found that the bank hid millions of dollars for wealthy people, including some Canadian billionaires.

Geneva's chief prosecutor Yves Bertossa told a news conference that HSBC failed to detect money laundering through its private bankoperations.

Part of the probe focused on four clients who shifted Mediterranean and Israel-based funds through the bank.

"This affair shows the weakness of Swiss law in fighting the entry of criminal funds into the financial circuit." Olivier Jornot, Geneva's attorney-general, told Reuters.

"It's easy to ask public prosecutors afterwards to carry out titanic investigations. But on the other hand when we have a law that practically doesn't punish intermediaries accepting money of dubious origin, there is a problem."