Spain's National Court on Thursday said it is investigating tax fraud allegations against Banco Santander SA's Chairman Emilio Botín and nine other members of the influential Botín family, including Ana Patricia Botín, head of Santander's U.K. operation.
In a press release, the Madrid-based court said anticorruption prosecutors claim French authorities alerted Spain's tax revenue service about several Spanish clients of HSBC Holding PLC's Swiss private bank who didn't properly report income related to such accounts between 2005 and 2009.
The family, however, rapidly responded that it has already paid €200 million ($283.6 million) in back taxes and expects the charges will be dropped. "The family has completely and voluntarily normalized its tax situation," said a family spokesman.
That probe was triggered by information obtained by French officials from Herve Falciani and Georgina Mikhael, two HSBC employees who copied thousands of files of wealthy clients of the bank and offered them to authorities in various countries. HSBC declined to comment.
The Botíns are among the most prominent individuals to be exposed as a result of the stolen data. They have been at the helm of Santander for generations and have wide-ranging business interests in Spain and abroad. Santander today is the euro zone's largest bank by market value and will hold its annual general meeting Friday.
National Court investigative judge Fernando Andreu said in a statement that Emilio Botín and his relatives had filed amended tax returns for the years in question. But he said authorities hadn't had time to review the "enormous" quantity of documentation the Botíns provided before the statute of limitations would kick in. If the new tax returns are found to be complete, the fraud charges will be dropped, he said.
According to court documents, the origin of the Botíns' Swiss investment was an account opened by Emilio Botin's father, who died in 1993 and passed the money on to his children and grandchildren.
The National Court is a tribunal with national jurisdiction that handles high-profile cases linked to terrorism and white-collar crime. Its judges, whose job is similar to that of a U.S. district attorney, act on their own investigations and are independent from Spain's executive branch.
It is not the first time the National Court examines the conduct of Spain's most prominent banker, though it has never convicted him of any wrongdoing nor forced him to step down from his job. In recent years the court has investigated Emilio Botín, for example, in relation to a tax-free investment product his bank offered clients and for multimillion severance packages paid to outgoing executives.
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