Personal Finance

Britain Investigates Liechtenstein Bank Accounts


Britain's tax authority is investigating up to 100 British citizens with bank accounts in secretive Liechtenstein after buying data from an informant in a similar move to Germany, a newspaper reported on Sunday.

Her Majesty's Revenue and Customs (HMRC) paid the informant 100,000 pounds ($196,500) for the bank details of scores of wealthy Britons, The Sunday Times said, adding that the records had been stolen from the tax haven.

An HMRC spokesman declined to confirm the report, but said: "HMRC is using the powers given to it by parliament to protect the UK Exchequer from those who seek to hide behind secrecy laws to deprive the UK of tax revenues to which it is entitled."

A major German investigation into tax dodging centring on Liechtenstein and its secretive banks has sparked a backlash in Germany against the tiny Alpine country, which relies on discreet banking services to attract foreign cash.

Liechtenstein is one of three countries on the Organisation for Economic Cooperation and Development's (OECD) tax-haven black-list, alongside Andorra and Monaco.

Any Briton found to have evaded tax by putting money in a Liechtenstein account faces fines of up to 100 percent of the money owed to British tax authorities and, if deception is proven, up to seven years in prison, The Sunday Times said.

German media have reported that Germany's BND intelligence service paid an informant around 4.2 million euros for a compact disk containing Liechtenstein bank data on over 1,000 tax evasion suspects.

Germany's Finance Ministry confirmed the German government paid for information. Liechtenstein accused Germany of illegally acquiring the data.

The German tax probe has focused on suspicions that hundreds of rich Germans evaded taxes by parking money in Liechtenstein's banks. It has cost Deutsche Post's chief executive his job and threatens to claim other high-profile victims.

Shares in Liechtenstein-based banks have been hit hard by concerns the German probe could hurt their reputations and business.

Prime Minister Otmar Hasler defended his country's policies this week but also pledged to cooperate with Europe in combating fraud.