(Releads on UBS statement, adds bank reaction in 2nd paragraph)
ZURICH/PARIS, July 23 Swiss bank UBS
said it had been ordered by French officials on Wednesday to pay
1.1 billion euros ($1.48 billion) in bail after being put under
formal investigation over allegations it laundered the proceeds
of tax evasion.
The bank issued an unusually strongly worded condemnation of
the bail order, issued at a Paris hearing earlier in the day,
alleging political undertones as a French investigation into how
it dealt with its wealthy clients there widened.
"We were notified today at a convocation hearing in Paris of
an unprecedented and unwarranted amount of bail amounting to 1.1
billion euros in the ongoing investigation of UBS AG's French
cross-border case," the Zurich-based bank said in an emailed
statement following a inquiry from Reuters on Wednesday.
"We consider both the legal basis for the bail amount and
the method of calculation to be deeply flawed and will appeal
... It is not acceptable to us that this has become a highly
"We will continue to defend our case strongly," UBS said.
It was not immediately clear if any individuals at the bank
were named as the subjects of the bail order.
Last year, a French prosecutor put the UBS head office and
its subsidiary in France under formal investigation on related
charges of illegal sales practices and complicity in illegal
sales practices, respectively.
The alleged sales practices in question involved seeking out
wealthy customers in France who would be interested in opening
bank accounts inaccessible to French tax authorities.
Three former and current executives with UBS' French
subsidiary were also individually placed under investigation, a
spokesman at the subsidiary said on Wednesday.
"In the course of the last few years, we have done
everything we can to bring this matter to a close. We have also
taken significant and broad steps to ensure tax compliance of
our clients and will continue to do so," UBS said.
French judicial authorities probing UBS over the allegations
visited the bank's Paris headquarters in November.
($1 = 0.7430 Euros)
(Reporting by Chine Labbe, Katharina Bart, and Nick Vinocur;
Editing by David Holmes, David Evans and Hugh Lawson)