Late M&A banker Jean-Marc Forneri’s Swiss lawyer and wealth manager were found guilty of helping him conceal assets and dodge taxes in a French crackdown on those who facilitate financial crime.
The Swiss lawyer, John Metzger, was given an 18-month suspended sentence and a fine of 300,000 euros ($359,000) by the Paris criminal court on Thursday and the wealth manager, Michel Glas, got a one-year suspended term and a 150,000 euro penalty.
Presiding Judge Christine Mée said the two must each pay 50,000 euros in damages to the French state, a plaintiff in the case, and are banned from doing their jobs for five years but didn’t provide any further detail on the court’s reasoning.
An attorney Glas, who has denied any wrongdoing, didn’t immediately respond to requests for comment. Jean-Pierre Versini-Campinchi, an attorney for Metzger, said his client appealed his conviction immediately, suspending the sentence.
The ruling comes as French enforcers cast the dragnet far and wide to deter potential enablers of tax fraud. The Parquet National Financier’s landmark cases in recent years have included the conviction of five former UBS Group AG bankers and a record penalty of $5.4 billion for the Zurich-based lender, all of which have appealed.
Also snared in other cases were a tax lawyer for the heiress to fashion designer Nina Ricci and the chief executive officer of Reyl & Cie in a probe focusing on the secret Swiss account of a French minister.
On Thursday, Paris judges also rejected a request from Forneri’s daughter to unfreeze some 600,000 euros that investigators had seized as part of the probe. The court said it could be considered an indirect product of the wrongdoing — laundering the proceeds of tax fraud.
Forneri — who over a high-profile career advised a French finance minister, climbed to the top ranks at Credit Suisse Group AG and ran his own M&A firm — wound down his Bahamas company in 2014 and moved nearly $1.5 million from an undeclared account at the Swiss bank to one in London in his own name.
The transfer raised red flags at the anti-money-laundering watchdog in France and drew the attention of the tax man. A police raid on his home outside Paris a few years on in 2017 turned up about $6.5 million stashed away in another unreported account, this one at Morgan Stanley in the U.S.
While the probe ended against Forneri when he died late last year, the case continued against Metzger and Glas, leading to the trial.
French investigators have alleged that Metzger purposefully set up the Bahamas structure to help Forneri shelter more than $2 million in Credit Suisse stock options from tax authorities in France. The wealth manager, Glas, was accused of having initiated the move by introducing Forneri to Metzger in the mid-2000s.
During the trial hearing in May, Metzger and Glas said they had no idea Forneri’s tax affairs were in such a shambles. They pointed to the fact that Credit Suisse’s compliance teams in the U.K. audited the Bahamas company’s account at the Swiss bank several times without ever raising any concerns. Neither of them had anything to do with the secret Morgan Stanley millions.
By Gaspard Sebag, June 24, 2021, published on BLOOMBERG