DELHI: Indian tax officials have investigated Mumbai headquarters of HSBC, which was related to allegation that the bank’s Swiss business helped clients evade taxes.
The search came as HSBC prepared to release its annual report, in which the bank said it had received a request for information from Indian tax authorities.
The cash-strapped government is cracking down on tax evasion as a means of boosting revenue. In October, it said the state was prosecuting several individuals on suspicion of having undeclared assets outside the country.
Its pursuit of Europe’s biggest bank comes after details of HSBC’s Swiss private banking operations and top clients were widely published in the media, sparking regulatory inquiries worldwide that could result in significant fines.
India, Asia’s third-largest economy, is the only Asian nation to aggressively investigate HSBC relating to allegations of helping customers pay less tax. The bank’s Swiss client list numbered 1,195 wealthy Indian.
“Tax department officials visited the bank’s headquarters last week in Mumbai, and asked for documents related to this case,” said the person, who was not authorized to speak with media on the matter and so declined to be identified.
HSBC said, without elaborating, that it is cooperating with Indian authorities.
HSBC’s chief executive said allegations about its Geneva-based private banking arm, raided last week by Swiss officials and now the subject of a British inquiry, had damaged HSBC’s image and brought “shame” on the bank.
HSBC said authorities in countries including Belgium, France, Switzerland, Argentina and India were investigating or reviewing the local operations of its Swiss private bank in connection with allegations of tax evasion or tax fraud, money laundering and unlawful cross-border banking solicitation.
