Danny McCance 21 Mar 2017 03:35pm

UBS to face criminal trial in France

The Swiss bank could be forced to pay fines of up to €4.9bn (£4.45bn), depending upon the outcome of the tax evasion trial in France

The trial, the date of which has yet to be announced, will aim to establish to what extent the bank helped wealthy clients evade taxes in France.

If UBS loses the trial they could forced to pay up to half of the alleged €9.8bn of illegal client funds considered to be held by UBS, under the French legal system.

The trial was set as settlement talks failed between the bank and the national financial prosecutor’s office (PNF). UBS refused to pay the €1.1bn settlement that the French prosecutors had requested, stating that it was too high.

Markus Diethelm, the bank’s general counsel, said, “Such a large amount is unthinkable vis-à-vis our shareholders, as well as vis-à-vis other jurisdictions with which we have negotiated.”

The trial is the latest in the long-running saga for UBS. In July last year the Swiss Federal Tax Administration directed a disclosure order to the bank after a French data request. The French prosecutors were said to be following up on information provided to them by the authorities in Germany.

In 2014 UBS was forced to pay €300m to settle an investigation in Germany, in which a number of German probes attempted to establish if the bank was involved in helping clients evade taxes.