French Authorities Raid 5 Major Banks in €100 Billion Fraud Investigation

French authorities raided five banks across Paris’ finance center on Tuesday, in an attempt to uncover evidence of a multi-billion euro tax fraud scheme dubbed “cum-ex.” The French capital has seen multiple raids on major banks on its territory as authorities are leading an investigation into a possible fiscal fraud and money laundering case. French authorities have reportedly raided five major banks in a €100 billion fraud investigation, according to a report from Deutsche Welle (DW) on Tuesday.

€100 Billion Fraud Investigation Unfolds in Paris

The coordinated raids targeted prominent financial institutions suspected of involvement in a vast "cum-ex" tax evasion scheme. On Tuesday, French officials conducted raids connected 5 large banks located successful and astir Paris, including Societe Generale, BNP Paribas, HSBC, Natixis, and BNP’s Exane Bank. The investigation aims to determine the extent of their participation and potential liability in the alleged fraud.

What is the "Cum-Ex" Fraud?

Hundreds of bankers allegedly were involved in that fraud involving “cum-ex” transactions in which participants swap shares to collect reimbursement for taxes they had never paid. This complex scheme exploited legal loopholes to claim multiple refunds on dividend taxes paid only once, resulting in a massive loss of revenue for national treasuries.

Impact of the Raids on the French Banking Sector

The raids mark a significant escalation in the ongoing investigation and send a strong message to the French banking sector. Moreover, the potential financial and reputational consequences for the implicated banks could be substantial, depending on the outcome of the investigation and any subsequent legal proceedings. The investigation continues, and further developments are expected.