Legal hassles continue to trouble Swiss banking giant UBS AG (UBS). After losing an initial appeal against $1.4 billion (€1.1 billion) bail payment in a French tax-evasion probe in September, the bank’s appeal was rejected this time by France’s apex appeals court, Cour de Cassation. Notably, as per the prior order the bank had made the payment in September.
UBS has been under investigations by the French authorities on potential charges of illegally soliciting clients in France to open Swiss accounts for hiding undisclosed wealth in the period between 2004 and 2012. Earlier this year, the investigation included money laundering charges against the bank.
Following the failure of settlement talks on account of UBS’ refusal to plead guilty, the bank was ordered to pay the bail amount in July. Considering any possible adverse impact on the business, UBS restrained from pleading guilty. Notably as per French regulations, a settlement involves a guilty plea.
UBS is disappointed with the latest ruling and proposes to contest the court’s decision including right to a fair trial at the European Court of Human Rights. Per a statement of the company, “As we have said before, UBS believes that the basis for calculating the bail amount is exaggerated, speculative and not based on facts.”
Notably, the Swiss bank paid $780 million in 2009 to regulators as settlement related to U.S. criminal and civil investigation and acknowledged that it had helped clients evade taxes. UBS AG is not the only Swiss bank to be involved in such issues. In May 2014, Credit Suisse Group AG (CS) pleaded guilty to criminal charges of assisting its U.S. clients to evade tax.
Some favorably ranked stocks in the finance space include CorpBanca (BCA) and Baylake Corp. (BYLK). Both the stocks carry a Zacks Rank #1 (Strong Buy).
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