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HSBC to Pay $330M in Antwerp Fraud Settlement

Aug 7, 2019 10:47 AM   By Joshua Freedman
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RAPAPORT... A Swiss unit of HSBC has agreed to pay a record EUR 294.4 million ($330 million) to settle fraud claims against its Belgian business, which mainly served members of the Antwerp diamond trade.

In 2014, a Belgian judge charged HSBC Private Bank (Switzerland) with crimes including organized tax fraud, money laundering and forgery of documents. The bank is also suspected of having deliberately encouraged tax evasion by helping certain customers hide their assets in offshore companies in Panama and the Virgin Islands, the Brussels public prosecutor said in a statement Tuesday.

“The suspicions...primarily relate to its presence and its many years of illegal intervention in Belgium with a view to attracting and managing the assets of a very well-to-do clientele, particularly from the Antwerp diamond industry,” the statement continued.

Since the investigation began, HSBC has taken measures to improve its transparency, controls and risk management, the prosecutor noted. That has included appointing directors responsible for compliance and financial crime, terminating certain services relating to offshore companies, and separating itself from “numerous markets and customers.”

The deal is the largest amicable settlement of a fraud case in Belgian history, exceeding the EUR 160 million Omega Diamonds paid in December 2013, according to Belgian newspaper De Tijd. The HSBC agreement still requires court approval, with the hearing likely to take place next month, a spokesperson for the prosecutor noted.

HSBC confirmed the settlement on Monday in its half-year report, but declined to comment further.

Image: A branch of HSBC. (Peter Ringstad/Flickr)
Tags: Antwerp, Belgium, diamonds, HSBC, Jewelry, Joshua Freedman
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