News

UBS Group's Tax Evasion Case: French Supreme Court Partially Overturns Previous Decision

James L. Flint

• November 15, 2023

The French Supreme Court has partially overturned a previous court decision regarding UBS Group's involvement in assisting wealthy clients in France evade taxes. This latest ruling rescinds the financial penalties that were imposed on UBS in December 2021.

Previously, the French Court of Appeal had enforced a fine of 3.75 million euros ($4.1 million), confiscated EUR1 billion, and awarded civil damages of EUR800 million to the French state, which UBS appealed against.

Wednesday's decision is final and cannot be appealed. The Supreme Court has sent the case back to the Paris Court of Appeal to reconsider potential penalties.

In response to the ruling, UBS stated that it would defend itself in the forthcoming trial, expressing satisfaction that the highest court in France supports its position on key aspects of the legal case. However, the bank is disappointed with the confirmation of the previous court decision regarding unlawful client solicitation and aggravated laundering of the proceeds of tax fraud.

The investigation into UBS and some former employees has been ongoing in France since 2013. Initially, a court of first instance imposed a record fine of EUR3.7 billion on UBS and ordered the bank to pay EUR800 million in damages to the French government for lost tax revenue. The appeal court later reduced the fine in 2021.

As of September, UBS reported provisions of EUR1.1 billion in its financial report concerning the tax case. This figure represents the bank's best estimates of possible financial implications.