UBS Group AG sought to convince France’s top court on Wednesday to overturn a reputation-damaging conviction and €1.8 billion ($1.9 billion) penalty for helping wealthy French clients stash away undeclared funds in Swiss accounts.
(Bloomberg) — UBS Group AG sought to convince France’s top court on Wednesday to overturn a reputation-damaging conviction and €1.8 billion ($1.9 billion) penalty for helping wealthy French clients stash away undeclared funds in Swiss accounts.
The hearing comes nearly two years after the Paris court of appeals more than halved UBS’s initial fine but upheld a finding that the firm had illegally laundered funds. The Cour de Cassation could take several months to deliver a verdict.
The guilty finding is based merely on “abstractions” that led to a “global — if not moral — conviction,” of the lender, Patrice Spinosi, an attorney for UBS, said in court.
The UBS legal saga in France has rumbled on for more than a decade. It’s featured failed settlement talks, a banking boss calling his staffers “egomaniacs,” a whistle blower spying on former colleagues during tennis matches at the French Open and investigators accusing the bank of deploying tactics “worthy of James Bond” to avoid detection by authorities.
In addition to UBS’s guilt, the nation’s top court will examine the penalty the bank received and the damages award. UBS’s total penalty included €800 million in reparation for the French state, a €1 billion confiscation order and a €3.75 million fine.
UBS’s actions “brought discredit” to the France’s anti-money laundering apparatus, said Régis Froger, a lawyer for the French state. He said that banks have a unique role to play in that fight.
In 2021, UBS was also convicted of covertly and unlawfully dispatching Swiss bankers in France to encourage prospective clients to move money across the border.
If the Cour de Cassation’s interpretation diverges from the prior ruling, it could opt for a re-examination by a different panel of judges at the Paris appeals court.
UBS acquired local rival Credit Suisse in a rescue that closed in June. The deal has set the bank on one of the most complex integrations since the financial crisis, which includes efforts to keep key talent in certain areas while shedding other aspects of the business.
(Updates with remarks from UBS, French state attorneys starting in third paragraph)
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