* Probe triggered by records taken from Geneva office
* No allegations of wrongdoing by Canadians reported
* Europe's biggest bank says its is cooperating
* Switzerland's bank laws make it popular tax haven
(Adds government statement, HSBC reaction, PM comment)
By Cameron French
TORONTO, Sept 30 French investigators are
probing some 1,500 Canadian-registered Swiss bank accounts at
HSBC (HSBA.L) as part of a crackdown on unreported wealth, the
head of Canada's revenue agency said on Thursday.
Authorities are looking into accounts obtained from a
former HSBC worker who allegedly stole the records from the
bank and handed them over to investigators. Canadian tax
authorities are working with the French investigatorsù
HSBC, Europe's largest bank, said it was cooperating with
The paper trails marks the latest breach of strict bank
secrecy laws that make Switzerland a popular tax haven, and
comes as Canadians are increasingly storing money in offshore
"The largest accounts are now being audited, and others
will follow. All accounts that are linked to Canadian taxpayers
will be reviewed," Keith Ashfield, minister of national
revenue, said in a statement entitled "Canada cracks down on
unreported offshore account holders".
While it is not illegal for Canadians to hold Swiss bank
accounts, they must declare all their income to Canadian tax
No allegations of wrongdoing by Canadians were mentioned by
the minister or in initial media reports about the probe.
Government and academic studies in recent years say that
Canadian investments in offshore tax havens has ballooned in
the past decade.
"If havens are used to evade legal taxes, the government
will use all the force of the law against these citizens."
Canadian Prime-Minister Stephen Harper said during a
parliamentary back-and-forth with opposition members on the
subject of the probe.
Switzerland is the world's biggest wealth manager with 27
percent of global offshore assets, followed by Britain and
Its status was tarnished last year following a damning U.S.
tax probe that revealed UBS UBSN.VX had helped Americans
seeking to hide money abroad. The U.S. Internal Revenue Service
has recovered billions in lost taxes as part of the
Canada has requested that UBS (UBS.N) UBSN.VX hand over
the names of Canadian clients suspected of tax evasion. A
number of Canadians agreed to settlements totaling tens of
millions of dollars.
A spokesman for HSBC noted that the bank was also a victim
of a criminal act, pointing to the theft of the records.
"HSBC in no way condones tax evasion and is cooperating
with authorities while protecting the rights of our clients to
confidentiality." said Jezz Far, the bank's global head of
The documents in the French probe showed that
proportionally more of the HSBC bank accounts were held by
Canadians than Americans, who had about 1,600 accounts,
according to a report by the Globe and Mail newspaper and
Canadian Broadcasting Corporation.
Canada's population is a little more than one-tenth the
The Globe report also said that as many as 1,800 accounts
were being looked at.
It was unclear how much money are in the accounts, but the
HSBC employee who gave the documents to investigators told the
Globe that clients were required to deposit a minimum of
C$500,000 ($488,760) each.
(Additional reporting by Solarina Ho and David Ljunggren;
Editing by Frank McGurty)