contents
UBS goes all out. She doesn’t let the guilty verdict of last week sit on her: the criminal judgment of the second instance is being referred to the French Supreme Court. In doing so, the bank chooses the lesser of two evils.
It is true that there are now even more legal fees, even more unrest and even more unfavorable headlines. The outcome of the prominent legal dispute remains uncertain – much longer than the image-conscious bank can do. In addition, such imponderables displease investors. The affair could weigh on the share price for years to come.
The presumption of innocence still applies
But UBS has not yet been legally convicted for its alleged criminal behavior in France. Of course, the accusation remains that she systematically helped rich French people evade taxes. But in principle the presumption of innocence applies as long as the legal dispute is ongoing.
Other foreign authorities should carefully consider trying to copy the French public prosecutor’s approach. Because it shows: The Swiss big bank is unruly: If you want to successfully take it to court for money laundering of income from tax fraud, then it obviously takes a lot of patience.
In the meantime, UBS can continue to represent its view that it was not guilty of criminally relevant behavior in the French business. This is consistent in terms of content. After all, since the investigation began a good ten years ago, the largest Swiss bank has always emphasized that it was innocent in this matter.
Coherent defense strategy
UBS does not deny that undeclared funds of wealthy French were with it in the past. But that alone has not made her liable to prosecution. The bank argues that the latest verdict of the Paris Court of Appeal is wrong. The new € 1.8 billion fine was also inadequately derived. Just like the 4.5 billion euro fine that the first instance had ordered UBS to pay in February 2019.
Even if this presentation is unlikely to convince all observers and commentators. As a defense strategy in a billions in litigation, it seems – viewed soberly – at least conclusive.
What is also important is what happens to the billions in bail, which – according to the latest judgment from Paris – is to be confiscated by the French state, to a certain extent as part of the penalty. For the time being, UBS can book this deposit as a claim, i.e. as money that it has on the deposit account (similar to a rental deposit).
In other words, the bank also tends to do better financially when contesting the legal ruling. In return, she obviously accepts further uncertainty and negative headlines.