Israel's tax authority said on Thursday it was working to obtain the details of thousands of Israelis with accounts at the Swiss arm of HSBC, after the bank admitted failings that may have allowed some customers to evade taxes.
According to the International Consortium of Investigative Journalists (ICIJ), which this week coordinated the release of leaked data from HSBC in Switzerland, Israel ranked sixth among the 203 countries whose citizens were customers, with 6,554 Israelis holding accounts worth $10 billion.
“We have tried to receive the data from authorities. We tried in various ways, direct and indirect, but we didn't get it,” said Idit Lev-Zerahia, a spokeswoman for the Israel Tax Authority. “We are now renewing our efforts.”
Moshe Asher, the head of the authority, told the Globes financial newspaper he was rebuffed by French authorities when trying to get the details but that the tax authority was “determined to obtain this list.”
Having a Swiss bank account is not illegal in Israel, as long as it is reported to authorities.
Israeli newspapers have reported that among Israelis on the list were bank owners and directors, diamond and real estate moguls, retired military officers, public and private company heads, well-known lawyers, a “popular” TV presenter, artists, soccer players, sport agents, a retired judge and a former prosecutor.
The tax authority has many other lists of people with bank accounts in Switzerland, Lev-Zerahia said. In recent months, some 32 Israelis have been arrested over secret accounts worth tens of millions of dollars held at UBS in Switzerland.
Israeli Intelligence Minister Yuval Steinitz said Israel had do more to prevent Israelis “avoiding tax by shifting the money to some banks elsewhere.”
“I am not surprised,” Steinitz, who was finance minister until 2013, said of the HSBC leak. “We always thought the illegal black economy in Israel is too big,” he told Reuters.
A spokesman for Israeli billionaire Beny Steinmetz, who was named in Israeli newspapers as having an account, said: “Steinmetz is a Swiss resident, pays taxes in strict accordance with his agreement with the Swiss tax authorities and has always managed his bank accounts in Switzerland in full compliance with all applicable laws and regulations.”
Former Bank Hapoalim chairman Shlomo Nehama said in an emailed statement to Reuters that at one point he had about $104 million in an HSBC account in Switzerland comprised only of funds derived from the sale of shares and options in a company he owned.
“The gains from such sale and the income arising in the account were legally and legitimately obtained and were duly reported to the Israeli tax authorities,” he said.
Asher, the head of the tax authority, noted that since the leaked HSBC accounts were held between 1998 and 2007, it was possible some had since been closed or transferred.
“Even if it takes time, and it will take time, we will reach every account holder and more than that, nobody can be certain their account won't immediately come up for investigation,” he told Globes.
The tax authority is offering immunity from criminal prosecution for anyone who comes forward to report an account abroad.
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