Panama Papers: Several major interbank FX dealers to be quizzed by British MPs over offshore tax avoidance

HSBC, Deutsche Bank, UBS and Credit Suisse, four of the world’s largest handlers of interbank FX order flow, are to be quizzed by Members of Parliament in Britain following the leak of over eight million documents held by Panamanian law firm Mossack Fonseca this week, which has caused suspicion that the firms had wealthy clients closely linked to offshore tax avoidance schemes.

In addition to the big four electronic trading giants, each of which have vast private wealth management divisions, Rothschild and Coutts & Co have also become part of the investigation.

Indeed, Stuart Gulliver, CEO of HSBC is currently the subject of an investigation into his own personal investments, as a claim has been made that he placed £5 million in a Panamanian firm called Worcester Equities.

Whilst absolutely no suggestion has been made that any of the banks concerned have acted illegally, the Treasury Select Committee has stated that it will ensure that Members of Parliament within the senior government office investigate these claims as a matter of urgency.

Bearing in mind that all four of the big banks are publicly listed entities, such an investigation may result in an openly public showdown with bank executives within a very short period of time.

Mark Garnier, Treasury Select Committee Member for the Conservative Party yesterday publicly stated

“We need to give these blue-chip banks an opportunity to answer the accusations they’re apparently supporting tax avoidance. I would hope we’ll be able to look into this fairly quickly.”

A convention between Treasury Select Committee members is scheduled to take place next week, in order to discuss when the hearings could be brought about.

HM Revenues and Customs has stated that it will ‘relentlessly pursue’ offshore tax avoiders in the aftermath of banks using Mossack Fonseca having been condemned globally this week by government authorities across the world.

The FCA has pledged support, and a vocal statement by fromer Public Accounts Committee chair Margaret Hodge was made, as she had previously taken a swipe at HSBC CEO Stuart Gulliver over his tax affairs.

“The more we learn the more questions HSBC and Mr Gulliver have to answer. He needs to come in and answer questions about what he knew and whether he told us the truth” she said.