Suspicions of giant tax fraud: searches in five banks in France

These operations “come within the framework of five preliminary investigations opened on December 16 and 17, 2021 on the count of aggravated money laundering of aggravated tax evasion, and for some of aggravated tax evasion, relating to the so-called “CumCum” fraud scheme”, a tax scheme on dividends, said the PNF.

A group of sixteen media revealed in 2018 via the “CumEx Files” these suspicions of giant tax fraud. The amount, initially estimated at 55 billion euros, had been significantly increased in 2021 by the consortium, rising to 140 billion euros over twenty years.

“Ongoing operations, which required several months of preparation, are conducted by 16 magistrates from the PNF and more than 150 investigators from the financial judicial investigation service (SEJF), in the presence of six German prosecutors from the Cologne public prosecutor's office involved in the framework of European judicial cooperation added the prosecution.

Societe Generale, BNP Paribas, Exane (a subsidiary of BNP), Natixis and HSBC are targeted, according to “Le Monde”.

A spokesperson for Societe Generale confirmed to the AFP that a search had been underway at the group's headquarters since Tuesday morning, without knowing what the object was. The other banks did not respond to AFP immediately.

According to the public prosecutor, “some of these investigations follow a complaint”, filed at the end of 2018 by a collective “Citizens in an organized gang” created by the socialist deputy Boris Vallaud, “or a mandatory denunciation of the tax administration”, which would date according to “Le Monde” from the end of 2021.

The daily also affirms that the General Directorate of Public Finances (DGFip) “made its first tax adjustments at the end of 2021” concerning some of these banks “for sums amounting to tens or even hundreds of millions of euros”.

Asked by AFP, the DGFip did not comment, as did French customs and the Ministry of Finance.

The so-called “CumCum” practice in financial jargon consists of escaping the tax on dividends which must in principle be paid by foreign holders of shares in listed French companies.

To take advantage of the scheme, these owners of shares, small savers or large funds of investments, entrust their securities to a bank at the time of collection of the tax, thus escaping taxation.

The banks would have played an intermediary role, while charging a commission to the holders shares.