'Surprise' that just one prosecution has followed HSBC cliams

A former senior tax official has expressed “surprise” that just one prosecution been brought by UK authorities in relation to alleged tax evasion by clients of HSBC’s Swiss banking arm.

Dave Hartnett, who was head of tax at HM Revenue & Customs, said that there needed to be “a really good look” at how the disclosures about HSBC Suisse were dealt with.

Details of some 30,000 accounts at the Geneva-based private bank were leaked to the French authorities by a whistleblower, Herve Falciani, in 2007.

The French subsequently passed on details covering 3,600 UK account holders to their British counterparts.

Giving evidence to the Commons Public Accounts Committee, Mr Hartnett, who left HMRC in 2012, said he had always expected there would be more criminal prosecutions than the single case which had been brought.

“I would like to understand – and I don’t as I sit here – why there weren’t more criminal prosecutions. I had always expected there to be more,” he said.

“I am three years out of it so I don’t have that information. I would like to understand what difference would have been made had more resources been applied to the Falciani data.

“If you look round the world, I think only Ireland and the UK have prosecuted anyone from the Falciani list. That looks like a fairly miserable result. Someone should have a really good look at whether any of that could be done differently.”

His comments were rejected by the current HMRC tax assurance commissioner Edward Troup who insisted that they had been “diligent” in pursuing the information which they had received from the French.

“I was quite surprised to hear him make that statement. I don’t think there is anything there which suggests that we have not been diligent,” he told the committee.

“We have collected £135m. We believe we have collected all the tax, all the interest, and a significant amount of penalties. I don’t quite see where that statement Mr Hartnett came from.”

Mr Hartnett defended his decision to take a job with HSBC after he left HMRC, despite knowing of the difficulties at the bank.

“I was approached to join a committee that was looking to make the bank secure for the future after its difficulties in Mexico and in Switzerland,” he said. “I have to say the idea of helping make a huge bank secure for the future appealed a lot to me.”

He said that he had followed the rules for former senior officials on taking appointments outside the Civil Service “to the letter”.

“Colleagues checked it, the Cabinet Office checked it, the committee checked it, it went to the Prime Minister, and the Financial Conduct Authority also had to approve my appointment,” he said.