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Wednesday, February 28, 2024

Cum-ex tax scandal in France. Searches of five banks in Paris

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French authorities on Tuesday searched the Paris offices of five banks, including Societe Generale, BNP Paribas and HSBC, on suspicion of tax fraud. It is part of a wide-ranging European investigation into dividend tax evasion.

The Societe Generale bank confirmed that searches had taken place, but did not provide further information. The other banks did not immediately respond to Reuters requests for comment. Bloomberg reported that about 150 investigators were involved in the searches.

Cum-ex tax scandal in France

The French financial prosecutor’s office (PNF) said in a statement that the searches were related to the so-called cum-ex tax scandal. The scheme of operation consisted in instant trading of shares around the day of the payment related to them dividends. This practice was intended to hide the actual owner and allow multiple parties to apply for it tax refund.

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The investigation was launched in December 2021.

The prosecutor’s office confirmed Le Monde’s reports that searches also took place at the Paris branches of Exane, which is part of BNP Paribas, and Natixis, which is part of the French BPCE banking group, Reuters reported.

A spokesman for the French financial prosecutor’s office said that banks face fines totaling more than $1 billion.

Previously, similar investigations were carried out, e.g. In Germany.

Main photo source: Shutterstock

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