UBS to face a trial, trying to avoid €1.1 billion fine

UBS will go on trial in France for establishing a wide-ranging tax fraud scheme, legal sources said today. The swiss bank will be charged with illegal banking practices and dissimulating tax fraud, the sources said, adding UBS's French subsidiary will also go on trial for complicity.

“UBS has made clear that the bank disagrees with the allegations, assumptions and legal interpretations being made,” the bank said in a statement. “We will continue to strongly defend ourselves and look forward to a fair proceeding.”

France’s financial prosecutor aimed to get UBS to pay €1.1 billion, the same amount as the bond, to settle the case without admitting guilt, according to a person familiar with the matter, as Bloomberg reported today.

In June last year, French prosecutors recommended that UBS face trial for "aggravated laundering of tax fraud proceeds" while its French branch be judged for complicity in these crimes.
French MPs last year approved a new civil settlement procedure requiring that fines be based on the advantage derived from the wrongdoing, within a limit of 30% of average revenue over the past three years.

The move followed failed negotiations over a plea bargain. "Those negotiations failed in particular because prosecutors and the bank could not agree on the sum that the bank would have to pay," said one source close to the case.

A spokesman for UBS said the bank could not comment on the date of the trial.