Illegal tax probes made by French agents: report

French tax agents regularly travel to Switzerland without authorization from Swiss officials to investigate French citizens suspected of tax evasion, a Swiss newspaper says.

Agents working for France's National Directorate of Tax Investigations (DNEF) make covert, and very illegal, reconnaissance missions without
informing Swiss authorities, Le Matin reported on Sunday, quoting several unnamed agents.

"We are not allowed to go to Switzerland without an official mission order," one of the agents told the paper.

"However, nothing stops us from going on a weekend trip to Geneva to admire the Jet d'Eau," the agent said, referring to the city's massive fountain, a famous landmark.

He explained that Swiss authorities in recent years had been very slow to respond to French requests to pursue their investigations in Switzerland.

"In this context, we are tempted to go get the information for ourselves," he said.

Such missions were always carried out when an agent was officially on holiday, using a personal credit card for all expenses and often travelling with a friend or family member, according to the report, based on a number of interviews carried out in September and October.

Once in Switzerland, the agents would look, for instance, at businesses belonging to French taxpayers to make sure they have actual offices, employees and clients and are not just shell companies, the report said.

Switzerland's attorney general Michael Lauber meanwhile told the paper he was aware of the illegal French missions.

But he said it was very difficult to come up with the proof necessary to open an official investigation.
DNEF, meanwhile, refused to comment when Le Matin confronted it with the information.

Member comments

Log in here to leave a comment.
Become a Member to leave a comment.


Switzerland’s banks remain among the world’s most secretive

Despite the progress made over the years, the Swiss financial sector continues to be one of the least transparent in the world. But there is good news too.

Switzerland’s banks remain among the world’s most secretive
Switzerland remains one of the world's least transparent nations. Photo AFP

Switzerland is in the third place in the 2020 Financial Secrecy Index released by the non-governmental organisation (NGO) Tax Justice Network (TJN), which rates 133 nations based on their financial transparency.

Two other European countries, Luxembourg and the Netherlands, are also ranked among the top 10 least transparent nations on the TJN’s list.

Despite being in the third place, Switzerland ranks better this year than it did in the previous edition of the Index, which is released every two years — it slipped from the first to third place. The Cayman Islands and the United States took the first and second spots, respectively.

Switzerland reduced its risk of being an offshore haven for tax cheats by 12 percent, “finally improving enough to move off the top of the index”, TJN said. 

READ MORE: Switzerland's strangest taxes – and what happens if you don't pay them

This improvement is mainly due to Switzerland extending its international network for the automatic exchange of customer information to more than 100 countries. 

Also, in a referendum held last year, Swiss voters accepted the Federal Act on Tax Reform and AVS Financing (TRAF). This legislation introduced major changes in the Swiss tax system by ending some preferential tax schemes and replacing them with new regulations which are in line with international standards.

This tax reform prompted the European Union to change Switzerland's status from ‘tax haven' to one which is EU-compliant, removing strict controls on transactions within the EU. 

So why, despite all the reforms, does Switzerland still rank among the world’s least transparent nations?

According to a Swiss NGO Alliance Sud, wealthy people from poor countries can still hide their money here from the tax authorities of their home nations.

Alliance Sud noted that despite the progress made in the past years by Swiss financial institutions, “the fight against tax evasion remains insufficient”.

Switzerland is the world’s biggest centre for managing offshore wealth, with a quarter of global assets invested here.

For years, it has been placed on various lists of tax havens where wealthy foreigners could park their money. Faced with widespread criticism for this practice, Switzerland passed an anti-money laundering law in 1997 and introduced strict regulations against tax evasion.