x Abu Dhabi, UAETuesday 25 July 2017

Kejriwal takes aim at Swiss bank account holders

Arvind Kejriwal said HSBC was expediting the flow of black money - a term for money that is not declared to tax authorities - into accounts in its Geneva branch.

NEW DELHI // An anti-corruption activist yesterday accused Indian politicians and HSBC of helping rich industrialists hide "black money" in tax havens overseas.

Arvind Kejriwal said HSBC was expediting the flow of black money - a term for money that is not declared to tax authorities - into accounts in its Geneva branch.

His allegations came on the same day that Britain's revenue and customs service said it was examining a leaked list of the bank's customers, amid accusations that the clients included drug dealers and gun runners.

Mr Kejriwal said the Indian revenue authorities had a list of about 700 people who held accounts in an HSBC bank in Geneva, and that "a senior Congress party source" had sent him the names and 10 account holders and their balances as of 2006.

These names included Mukesh and Anil Ambani, of Reliance Group, with 1 billion rupees (Dh67 million) apiece in their Geneva accounts; Naresh Goyal, the promoter of Jet Airways, with 800m rupees; and Annu Tandon, a Congress parliamentarian, with 1.25bn rupees.

While three other people from the list were raided by Indian income-tax authorities, Mr Kejriwal said none of these major figures were prosecuted.

"On what basis were some people raided and others not?" Pranab Mukherjee, the finance minister at the time, "may have since become the president of India, but he needs to supply the nation with an answer", he said.

Mr Kejriwal's allegations represent another setback for the Congress party, which has been hobbled by a series of corruption scandals in recent years.

In 61-page statement handed out to the media, Mr Kejriwal included what he said were the photo-copied depositions of the three New Delhi residents who were raided by tax authorities. Although these were handwritten documents in question-and-answer format, they seemed to bear, on every page, the signature of income tax commissioners on every page.

Mr Kejriwal did not provide any proof for the holdings of the Ambani brothers, Mr Goyal or Ms Tandon. He said that he had received these details "in an Excel sheet" from Congress party sources and in the finance ministry.

Ms Tandon said the allegations were "completely baseless and malicious".

"It is not right on the part of Kejriwal to make such loose comments," she said.

Reliance Group said that all its overseas bank accounts were "fully compliant with all regulations and are disclosed in their appropriate jurisdictions and in India", and that neither "Reliance Industries Limited nor Mr Mukesh Ambani had any accounts with HSBC in Geneva".

In August, the Reserve Bank of India had investigated and cleared HSBC's India operations, after a report by a US Senate subcommittee claimed that the bank had "exposed the US financial system to a wide array of money laundering, drug trafficking, and terrorist financing risks due to poor anti-money laundering controls".

Yesterday, the UK revenue and customs department said it had been contacted about a leaked list of the bank's customers, and accusations in a British newspaper that the clients include drug dealers and gun runners.

"We can confirm we have received the data and are studying it. We receive information from a very wide range of sources which we use to ensure the tax rules are being respected," Her Majesty's Revenue and Customs said.

The Daily Telegraph reported yesterday that a list of the bank's disclosed by a whistle-blower had identified 4,388 people holding £699 million (Dh4 billion) in offshore current accounts, including criminals.

Banks have an obligation to notify authorities about suspicions over the source of cash deposited in its accounts.

HSBC said it was committed to "the highest global standards, including the procedures for the acceptance of clients" and confirmed that it had opened its own inquiry into the alleged data breach.


* With additional reporting by Associated Press