UBS Ends French Tax-Dodge Saga With $985 Million Settlement

(Bloomberg) — UBS Group AG ended a long-running legal case over helping French citizens dodge taxes by agreeing to pay €835 million in fines and damages, less than a fifth of the original penalty.

The Swiss bank said Tuesday that it would pay a fine of €730 million euros and €105 million euros in civil damages to the French State to settle the case, which relates to activities between the years 2004 to 2012. That compares with the €4.5 billion penalty originally handed down in 2019, then the largest-ever fine in a criminal case.

UBS had been found guilty of covertly and unlawfully dispatching bankers in France to encourage prospective clients to move money across the border to escape taxation, echoing previous activities in the US and elsewhere. The bank is working through a range of legal issues, including those inherited from 2023’s takeover of Credit Suisse. It said it is fully provisioned for the fine.

The legal saga has rumbled on for more than a decade with UBS fighting on to cut the larger penalty. UBS had been pushing to settle the investigation for less than 300 million euros it paid to resolve a similar case in Germany.

“The French Supreme Court definitively confirmed the Paris Court of Appeal’s prior decision finding UBS guilty of unlawful client solicitation and aggravated money laundering but referred the financial penalty and civil damages to be re-assessed by the lower court,” UBS said in a statement.

In a parallel case, the bank’s previous French unit was found guilty in March of harassing two whistle-blowers who lifted the lid on the bank’s efforts to help wealthy locals dodge taxes.

In August, UBS agreed to pay $300 million to settle a Credit Suisse-related case over mortgage-backed securities with the US Department of Justice, having paid $1.44 billion to settle its own long-running case over on the same matter in 2023.

(Updates with further details throughout)

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