China confirms three missing Hong Kong booksellers under probe

      

Three missing men linked to a Hong Kong store that sells books critical of China's Communist Party elite were confirmed to be under investigation by Chinese police for "illegal activities," according to the Hong Kong police. 

PHOTO: REUTERS

FEB 5, 20167:51 AM

[HONG KONG] Three missing men linked to a Hong Kong store that sells books critical of China's Communist Party elite were confirmed to be under investigation by Chinese police for "illegal activities," according to the Hong Kong police.

The police in the southern Chinese province of Guangdong confirmed that the booksellers Lui Por, Cheung Chi Ping and Lam Wing Kee are under investigation for "illegal activities" in relation to another publisher, Gui Minhai, the Hong Kong police said in statement on the government's website late Thursday. "Criminal compulsory measures" were imposed on them, the statement said.

Another bookseller, Lee Bo, informed the Hong Kong police in a letter sent by the Guangdong police he declined to meet the Hong Kong police at the moment. Mr Lee's wife confirmed his handwriting. Chinese police confirmed Jan 18 Mr Lee was in China.

The five men linked to the bookstore began disappearing in October, raising concerns in Hong Kong that China is encroaching on its autonomy. The official Xinhua News Agency reported earlier Gui Minhai is in custody on the mainland after surrendering to police over a fatal traffic accident that occurred more than a decade ago.

Hong Kong police said they replied to the Guangdong police saying that they want to follow up on the booksellers' situation and asked Mr Lee for a meeting as soon as possible.

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Ex-Julius Baer bankers to plead guilty in US in Swiss tax case

FEB 5, 201612:20 AM

[NEW YORK] Two former private bankers at Julius Baer are expected to plead guilty Thursday to charges that they helped wealthy American clients evade taxes, as the Swiss bank prepares to resolve a criminal investigation with a US$547 million settlement.

The expected pleas by Daniela Casadei and Fabio Frazzetto, both former client advisers at Julius Baer, in federal court in Manhattan come two days after the Swiss citizens arrived in the United States to face the charges.

Both are expected to appear in court again later Thursday, the office of Manhattan US Attorney Preet Bharara said in an advisory, using language typically indicative of a guilty plea.

Their prospective pleas came after Julius Baer in December disclosed that it had reached a deal with prosecutors to pay US$547.25 million to resolve a probe born out of a US crackdown on offshore tax evasion by Americans through Swiss banks.

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Casadei, 52, and Frazzetto, 42 were indicted in 2011 for conspiring to help US taxpayers hide more than US$600 million in offshore accounts and evade paying taxes.

Both would normally beyond the reach of US extradition, as Switzerland does not extradite its own citizens.

Their lawyers did not respond immediately to requests for comment Thursday. Julius Baer declined comment.

The US tax evasion crackdown has already resulted in charges against a number of bankers, lawyers and advisers and billions of dollars in settlements with Swiss banks.

The US Justice Department last week announced the final settlement in a program that resulted in deals with 80 banks for US$1.36 billion to avoid possible prosecution.

Banks that were already under criminal investigation like Julius Baer, though, were not eligible for the program, which required the banks to provide detailed information on the accounts of US taxpayers under investigation.

In 2014, Swiss banking giant Credit Suisse pleaded guilty to conspiring to aid and assist US taxpayers in filing false tax returns in a US$2.6 billion settlement.

The penalty was more severe than the US$780 million that rival UBS AG agreed to pay in 2009 as part of a deferred prosecution deal.

Wegelin & Co, which had been the oldest Swiss private bank, was meanwhile forced to close after agreeing in 2013 to plead guilty to conspiracy to evade taxes and pay US$74 million.

The case is US v. Casadei, US District Court, Southern District of New York, No. 11-cr-00866.

REUTERS

    
 

Julius Baer to pay US$547m for helping clients avoid taxes

Julius Baer Group Ltd agreed to pay US$547 million to avoid prosecution in the US after admitting it helped American clients hide billions of dollars in assets from the Internal Revenue Service. 

PHOTO: REUTERS

FEB 5, 20167:31 AM

[MANHATTEN] Julius Baer Group Ltd agreed to pay US$547 million to avoid prosecution in the US after admitting it helped American clients hide billions of dollars in assets from the Internal Revenue Service.

Switzerland's third-largest lender made detailed admissions of wrongdoing and prosecutors agreed to drop a conspiracy charge in three years if the bank abides by the terms of the deal.

The Julius Baer deal followed guilty pleas in Manhattan federal court on Thursday from two of its client advisers.

Daniela Casadei and Fabio Frazzetto admitted helping their US clients avoid taxes.

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"While I was convinced I was acting in accordance with Swiss law, I agreed to assist these US clients," Frazzetto said.

Casadei and Frazzetto were indicted in October 2011. They were accused of helping more than 180 US clients hide at least US$600 million in assets from the IRS.

A dozen or so Swiss banks, such as Pictet & Cie, Group SCA and the Swiss unit of HSBC Holdings Plc, are still waiting to end criminal tax investigations by the U.S.

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Julius Baer follows larger Swiss rivals UBS Group AG and Credit Suisse Group AG in resolving US tax probes. UBS did so by agreeing in 2009 to pay US$780 million, while Credit Suisse agree in 2014 to pay US$2.6 billion.  Christophe Hiestand, general counsel for Julius Baer, declined to comment after Thursday's hearing.

Another 80 Swiss banks avoided prosecution in the past year by agreeing to pay US$1.37 billion in penalties and voluntarily disclosing their wrongdoing as part of a Justice Department programme.

BSI SA agreed to pay US$211 million while Union Bancaire Privee settled for US$188 million.

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