Several French banks register for possible tax fraud

The headquarters of five entities have been searched this Tuesday in the framework of an investigation by the French National Financial Prosecutor’s Office (PNF) for alleged tax fraud and which, according to the newspaper ‘Le Monde’, would have affected the Parisian offices of Société Générale, Natixis, HSBC, BNP Paribas and Exane, a subsidiary of the former.

As confirmed by the financial judicial authority, the records at the headquarters of “five banking entities” in the financial district of the French capital take place within the framework of the preliminary investigations opened in December 2021 in relation to a plot to evade payment of taxes through the so-called ‘CumCum’ method.

As explained by the National Financial Prosecutor’s Office, this type of tax fraud consists of a foreign shareholder of listed companies in France lending their titles to a French bank when the dividend collection date approaches, thus avoiding the payment of the applied withholding by the French tax authorities on dividends received by residents abroad.

The operation, which has required “several months” of preparation, has been in charge of 16 PNF magistrates with the participation of more than 150 investigators from the judicial investigation service, in addition to the presence of six German prosecutors who have intervened as part of judicial cooperation at European level.

According to the French newspaper ‘Le Monde’, which revealed the scandal in 2018, the plot would have made it possible to evade billions of euros in tax revenue.