HSBC tax snitch seeks helping hand from French judiciary

Hervé Falciani, the former French-Italian HSBC employee who leaked information about 130,000 tax evaders with accounts at the bank and who was arrested in Barcelona on July 1, has started playing hard ball in his efforts to avoid extradition to Switzerland, where he faces prosecution.

Falciani, who asked Spanish prosecutors to verify that he had cooperated with French authorities, produced a potential ace from up his sleeve and petitioned the High Court to hear the testimony of Éric de Montgolfier. The French prosecutor discovered the information collated by Falciani, which has since allowed the authorities in several European countries to recoup billions of euros in unpaid taxes.

On January 20, 2009, prosecutors in Nice, led by De Montgolfier, ordered a search of Falciani's home in Castellar, where he had taken refuge after being arrested by Swiss authorities. France received a request to seize "a series of stolen data," with no further explanation. What the Swiss judiciary wanted was to recover were the files in Falciani's computer. When the French authorities discovered them, De Montgolfier elected not to hand them over but to open investigations against the list of French tax evaders therein.

Paris sent the information to all the European countries with bilateral financial data treaties. The Spanish tax agency said the names passed on constituted "the biggest regularization process in the history of the Treasury."

If De Montgolfier is called to testify in Spain, it will be a considerable boost to Falciani's bid to avoid extradition. Spanish authorities consider Falciani a protected individual for blowing the whistle on one of the largest money-laundering rings ever discovered.

"None of this would have been possible without Mr Falciani," De Montgolfier told the French Senate Committee for the Investigation of Tax Evasion.