An announcement today, by Belgian authorities, regarding their formal investigation into tax evasion and money laundering, allegedly conducted by HSBC Private Bank (Suisse) SA, for their wealthy precious gem clients from Antwerp, verifies that shell companies from Panama remain the money launderer's vehicle of choice. Included in the news release was the allegation that HSBC obtained Panamanian corporations, which contain bearer shares, for the purpose of assisting their Belgian clients evade income taxes, and to hide their funds abroad.
The Panama companies, employed by HSBC Switzerland for its clients, had no legitimate business function, and were formed solely for tax evasion reasons. The lack of a named owner of the shares of stock protected the identities of the affluent Belgian nationals, who were said to be in the diamond industry.
There is also a parallel ongoing French investigation of the Swiss branch of HSBC, regarding a number of its wealthy nationals. You may recall that a list of EU tax cheats who used Swiss banks, popularly known as the Lagarde List, has circulated among several countries in Europe. That is believed to be the source of the initial targets of the French investigation. Panama companies figure prominently in the French case as well.
At the risk of profiling, given the propensity of financial criminals, money launderers, and, as seen here, even private bankers breaking the law, to employ Panama corporations for their customers, one should consider whether all Panama corporations, used outside the Republic of Panama for financial transactions, are to be always regarded at high-risk, requiring an enhanced due diligence inquiry. This means that the company's lines of business, source of funds, and actual owners/controllers of the company are to be examined in depth. The Belgian and French HSBC investigations simply prove my point.