UK Tax Authority Paid For Liechtenstein Bank Data

by Robert Lee, Tax-News.com, London

26 February 2008

The UK's tax authority, HM Revenue and Customs, has reportedly paid for information contained on a stolen computer data disc, regarding British clients of the Liechtenstein financial institution at the centre of the tax evasion scandal in Germany.

According to the Sunday Times, HMRC paid GBP100,000 for the data, which could be used to launch tax investigations against approximately 100 wealthy Britons with undeclared financial arrangements in Liechtenstein.

It is understood that the data originated from the same informant who sparked a massive tax evasion scandal in Germany when it emerged that the intelligence services there had paid a sum of between EUR4 million and EUR5 million for a computer disc containing the names and account details of hundreds of wealthy Germans.

The Sunday Times suggested that the informant had also offered data to tax authorities in the United States, Canada, Australia and France.

The informant is supposedly an ex-employee of LGT Treuhand AG, the trust arm of Liechtenstein's LGT Bank, who was prosecuted by the jurisdiction's authorities in 2003 for stealing confidential information on the bank's clients.

While HMRC has not officially commented on the report, a spokesman told the BBC that it paid the informant "to protect the UK exchequer from those who seek to hide behind secrecy laws".

However, the actions of the German, and now the British authorities, have been strongly condemned by the Liechtenstein government, which believes that such methods amount not only to an illegal invasion of privacy, but also a breach of its own sovereignty.

Liechtenstein monarch, Crown Prince Alois has indicated that the jurisdiction's response to the German "attack" could could be to tighten its privacy laws.

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