Hervé Falciani

Hervé Daniel Marcel Falciani (Italian: [falˈtʃaːni]; born 9 January 1972) is a French-Italian systems engineer and whistleblower who is credited with "the biggest banking leak in history."[1] In 2008, Falciani began collaborating with numerous European nations by providing allegedly illegal stolen information[2][3] relating to more than 130,000 suspected tax evaders with Swiss bank accounts – specifically those with accounts in HSBC's Swiss subsidiary HSBC Private Bank.[4][5]

Hervé Falciani
Hervé Falciani in 2013
Born
Hervé Daniel Marcel Falciani

(1972-01-09) January 9, 1972
Monte Carlo, Monaco
Nationality
  • France
  • Italy
Alma materSophia Antipolis
OccupationSystems engineer
Known forLagarde list

Falciani is the person behind the "Lagarde list", so called as it is a list of HSBC clients who allegedly used the bank to evade taxes and launder money that Falciani leaked to ex-French Minister of Finance Christine Lagarde, currently the President of the European Central Bank. Lagarde, in turn, sent the list to governments whose citizens were on the list.[6]

On 11 December 2014, Falciani was indicted in absentia by the Swiss federal government for violating the country's bank secrecy laws and for industrial espionage. The indictment accused Falciani of stealing information from HSBC's Geneva offices and passing it on to tax authorities in France. HSBC had been indicted in France for money laundering in November 2014.[7] In November 2015, Switzerland’s federal court sentenced Falciani to five years in prison – the "longest sentence ever demanded by the confederation’s public ministry in a case of banking data theft". Falciani was accused of "aggravated financial espionage, data theft and violation of commercial and banking secrecy".[8]

Biography

After studying at the Sophia Antipolis technology park, Falciani became a computer engineer at the Swiss branch of HSBC between 2001 and 2008.[9] In 2006, he reorganized the database of the organization to improve its security.[10] Falciani has declared that he realized that the way data was managed at HSBC fostered tax evasion, and proposed a new system, which was rejected by his superiors.[11] After the HSBC reaction, and because he believed that "it is a systematic violation of fundamental rights of citizens by subtracting funds that should be allocated to the general interest", for two years Falciani collected evidence of potential tax fraud involving 130,000 individuals. Falciani tried to make the information available to the Swiss judicial authorities, but was unsuccessful. This claim was corroborated by French prosecutors.[12]

In 2008, Falciani made a trip to Beirut and, using a false identity, attempted to sell what he claimed was private client information from a Swiss bank to Bank Audi. Falciani claims that he did this in order to intentionally activate an internal alarm system available to Swiss banking employers, the Swiss Bankers Association (Swissbanking), and which is monitored by the police. He hoped this would allow Swiss prosecutors to become aware of HSBC's criminal activities. In their prosecution against him, however, Swiss authorities claimed that he went to Beirut with the intention of selling the data for profit. In either case, an alarm was indeed set off after a woman reported that a man calling himself Ruben al-Chidiak had attempted to sell her the private data.[13] Falciani says he paid for the airline tickets from his own HSBC account so that authorities could track him.[11]

On 22 December 2008, Falciani was arrested, questioned and released.[11][14][15] On release, Falciani travelled to France where he was arrested in January 2009, forcing the Swiss judiciary to issue an international arrest warrant for him. Switzerland called on France to search his home and to seize the laptop used to send the files. After searching the address, the prosecutor of Nice, Eric de Montgolfier,[16] opened his own investigation, not against Falciani, but against alleged tax fraudsters appearing in the list. The so-called Falciani list remains in France. An international collaboration began with various judicial authorities and remains ongoing. The Falciani list created a diplomatic incident between Switzerland and France. The latter finally agreed to return the data, but only after the contents had been examined. Afterwards Falciani fled to Spain on the advice of the U.S. government because "it would be easy for someone to pay" to try to kill him. Upon arrival, he was arrested in Barcelona in July 2012, due to the Swiss international warrant.[17]

He was jailed at Valdemoro prison (Madrid), waiting for the Audiencia Nacional to decide on his extradition to Switzerland. On 18 December 2012, the Audiencia Nacional released him provisionally.[10] It was in maximum security conditions: eight bodyguards and bulletproof vest. After that Falciani hid in Spain under a system of maximum security protection sponsored by the UN.[18] Finally, on 8 May 2013, Falciani was released.[19] The Audiencia Nacional, given the ongoing collaboration between Spanish and French courts, decided not to extradite Falciani, the reason being that he had provided information indicative of "severely irregular" suspicious activity, and of illegal and criminal offenses. He was released because in Spain there is no legal concept of bank secrecy, and information technology trade secrets can not be used to hide unlawful activities.[20] In April 2014, Falciani was called to assist the Argentine federal taxation agency (AFIP) in the fight against money laundering.[21]

Falciani published a book about his experience in the HSBC scandal called Séisme sur la planète finance (Earthquake on Planet Finance in English) that was published in April 2015.[22] He lived in Paris[13] for a time, but continued working with Spanish authorities, and stood as a candidate in Spanish elections for the anti-corruption X Party. In April 2018 he was again arrested in Madrid[23] and again released in September after a Spanish high court rejected the extradition request on the grounds that the Spanish legal code does not recognize ‘aggravated financial espionage’.[24]

Political activity

Hervé Falciani was first in the electoral list of the new Spanish political party Citizen Network X Party for the European elections of 2014.[25] He was elected by citizens in Internet through open lists.[26][27][28][29][30] Finally the X Party did not obtain any seats.

In February 2015, it was announced that Falciani will collaborate with the Spanish party Podemos to draft measures against tax evasion for the party's political program.[31][32]

Controversy

Falciani claims he was kidnapped by Israeli Mossad agents in Geneva, who were seeking information on bank clients with Hezbollah ties.[33]

Falciani claims that his motives are to repel Switzerland’s "attack" on other countries' tax laws and exchequers.[34] HSBC's position is that Falciani is not a whistleblower, that he has instead tried to sell, not release, the stolen data, and only started to cooperate with authorities after being imprisoned in Spain.[34] Regarding this allegation the Audiencia Nacional, a high court in Spain, stated that "this fact" (the court's quotation marks in reference to the allegation):

appears somewhat confused and inconsistent with the factual story that we present, which do seem objectively specific episodes of provision of information and effective collaboration with authorities of other states, which indicates a determined attitude of Falciani and not an economic motivation.[35]

Indictment

Falciani was indicted by Switzerland on 11 December 2014, for violating the country's bank secrecy laws and for industrial espionage. Falciani (who was not named in the indictment, as is customary for Switzerland) was charged with stealing information from HSBC's Geneva offices and passing it on to French tax authorities. The Swiss prosecutors said they were willing to try Falciani in absentia for his alleged crimes.[7]

In the month prior to his indictment, France had indicted HSBC for money laundering. Falciani had also offered his services to the government of India, which had been investigating money laundering abetted by HSBC. The Swiss government had refused to help the Indian government in its investigation of Indian citizens who were abetted in tax evasion by HSBC on the basis that the information detailing HSBC's alleged transgression was stolen.[36]

In an interview with the Indian television network NDTV, Falciani said that Switzerland indicted him as part of an "agenda" to stifle whistleblowers like himself who have exposed corruption in the Swiss banking industry.[36]

See also

References
  1. Leigh, David; Ball, James; Garside, Juliette; Pegg, David (8 February 2015). "HSBC files show how Swiss bank helped clients dodge taxes and hide millions: Data in massive cache of leaked secret bank account files lifts lid on questionable practices at subsidiary of one of world's biggest financial institutions". The Guardian. Retrieved 27 November 2015.
  2. "BBC News - HSBC admits huge Swiss bank data theft". bbc.co.uk.
  3. "Whistleblower? Thief? Hero? Introducing the Source of the Data that Shook HSBC". International Consortium of Investigative Journalists.
  4. "Ex-HSBC worker says US told him to flee to Spain". AFP. 2013-04-21.
  5. Brigitte Alepin Bill Gates, Pay Your Fair Share of Taxes...Like We Do! - 2012 p. 66 "The HSBC-2010 and Liechtenstein-2008 affairs are examples. In the HSBC-2010 affair, Hervé Falciani, a former bank executive with HSBC in Geneva, was arrested by the Swiss police on suspicion of data smuggling. He took refuge in France ..."
  6. "HSBC man who passed clients' details to tax investigators escapes extradition". The Guardian. Associated Press. 8 May 2013. Retrieved 11 January 2015.
  7. Miller, Hugo (11 December 2014). "Ex-HSBC Employee Falciani Said Indicted on Data Theft". Bloomberg. Retrieved 11 January 2015.
  8. Garside, Juliette (27 November 2015). "HSBC whistleblower jailed for five years over biggest leak in banking history". The Guardian. Retrieved 27 November 2015.
  9. Romero, José Manuel (25 March 2013). "La 'lista Falciani' conduce hasta Gürtel" [The Falciani list leads to Gürtel]. EL PAÍS (in Spanish). Ediciones El País. Retrieved 15 February 2015.
  10. Sánchez, Juan Luis (18 December 2012). "¿Quién es Falciani? ¿Qué sabe Falciani?" [Who is Falciani? What does Falciani know?]. eldiario.es (in Spanish). Retrieved 15 February 2015.
  11. Pérez, Fernando J. (15 April 2013). "Falciani robó los datos de la banca suiza tras ver sus actuaciones "escandalosas"" [Falciani stole the data from the Swiss bank after seeing their "scandalous" actions]. EL PAÍS (in Spanish). Ediciones El País. Retrieved 15 February 2015.
  12. 20Minutos. "Falciani colaboró con varias Justicias europeas con datos que llenarían "un tren de mercancías"". 20minutos.es - Últimas Noticias.
  13. Keefe, Patrick Radden. "The Bank Robber". The New Yorker. Retrieved 27 May 2016.
  14. "Todo lo que siempre quiso saber sobre Hervé Falciani". partidox.org. Archived from the original on 2014-04-08. Retrieved 2014-04-10.
  15. "Falciani: "En HSBC Suiza vi actuaciones escandalosas"". Expansion.
  16. Altozano, Manuel (21 April 2013). "Hervé Falciani: "Estados Unidos me avisó: Ve a España, tu vida corre peligro"" [Hervé Falciani: "The United States advised me: Go to Spain, your life is in danger"]. EL PAÍS (in Spanish). Ediciones El País. Retrieved 15 February 2015.
  17. "Arrestado el exempleado de HSBC acusado de robar datos secretos" [Arrested ex-employee of HSBC accused of stealing secret data]. EL PAÍS (in Spanish). Ediciones El País. 24 July 2012. Retrieved 15 February 2015.
  18. "Falciani y el Estado español: paradigma de la corrupción estructural". eldiario.es.
  19. "Falciani cifra en 200.000 millones el dinero que se evade en impuestos". eldiario.es.
  20. Pérez, Fernando J. (8 May 2013). "La Audiencia Nacional rechaza la extradición de Falciani a Suiza" [The National Court rejects the extradition of Falciani to Switzerland]. EL PAÍS (in Spanish). Ediciones El País. Retrieved 15 February 2015.
  21. "Se puede frenar la salida de dinero negro de Argentina" [It can slow down the exit of black money from Argentina]. ambito.com (in Spanish). 22 April 2014. Retrieved 15 February 2015.
  22. Delahousse, Mathieu. ""SwissLeaks" : un polar signé Hervé Falciani". L'Observateur. Retrieved 27 May 2016.
  23. Badcock, James (May 14, 2018). "Why HSBC whistleblower fears for his freedom". Retrieved August 10, 2019 – via www.bbc.co.uk.
  24. Spain rejects extraditing HSBC whistleblower to Switzerland The Guardian, 2018
  25. Jonathan Blitzer. "Democracy. Period". The New York Times.
  26. "Falciani tirará del equipo del Partido X en las europeas". publico.es.
  27. "El número dos de las primarias del Partido X cede su puesto a Simona Levi". eldiario.es.
  28. "Partido X, Partido del Futuro". partidox.org.
  29. "Hervé Falciani, un Indigné aux européennes". liberation.fr.
  30. "Elections: Falciani tête de liste aux Européennes en Espagne - News Monde: Europe - tdg.ch". tdg.ch/.
  31. "Hervé Falciani colaborará con Podemos para luchar contra la evasión fiscal". El Confidencial.
  32. "Falciani ficha por Podemos".
  33. Carvajal, Doreen; Minder, Raphael (8 August 2013). "A Fugitive with a Cause". New York Times. Retrieved 8 August 2013.
  34. M.V., The fall-out from Falciani, Schumpeter Business and management blog, The Economist, 16 October 2013
  35. Carreño, Belén (8 May 2013). "Falciani, libre" [Falciani, free]. eldiario.es (in Spanish). Retrieved 15 February 2015.
  36. Tiwari, Noopur. "Black Money Whistleblower Herve Falciani Alleges 'Agenda' in Indictment by Switzerland". NDTV. Retrieved 11 January 2015.

Further reading
  • La cassaforte degli evasori (2015, Milano, Chiarelettere con Angelo Mincuzzi)
  • Carvajal, Doreen; Minder, Raphael (8 August 2013). "A Fugitive with a Cause". New York Times. Retrieved 8 August 2013.

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