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Screenshot of a breaking news alert e-mail from Q2 2017
HSBC Holdings plc (LON:HSBA) CEO Stuart Gulliver is due to appear before the Treasury Select Committee today in order to give evidence alongside HSBC Chairman Douglas Flint with regard to allegations by Briitsh authorities that he has been party to tax avoidance by having a Swiss bank account routed via Panama with £5 million balance as well as being domiciled in Hong Kong for tax and legal reasons.
Mr. Gulliver will have a two hour meeting with Members of Parliament in Britain to put their questions to senior executives within the firm, and Mr. Gulliver, accompanied by Mr. Flint will give evidence to the committee prior to Lin Homer, chief executive of HM Revenue & Customs. She faces questions about why only one person has been prosecuted for avoiding taxes.
When Mr. Gulliver presented the bank’s results on Monday, which included notification that the financial giant had set aside a further $550 million for settlement of further potential FX rate manipulation penalties, he explained that he had a Swiss bank account to hide his bonuses from colleagues in Hong Kong. The Swiss operation in turn routed his payments through Panama to hide them from other colleagues locally.
He also explained why he was non-domiciled in the UK despite being born in the country. “I would expect to die abroad, which is the test around domiciliary,” said Gulliver, who has spent his career at HSBC after leaving for Hong Kong in 1990.
HSBC’s stock market value declined by $5 billion following the issue of its results, largely due to the allocation of such a large sum toward the potential settlement of further regulatory fines, however Mr. Gulliver’s revelations may also not bode well for the immediate future.
Photograph courtesy of The Guardian