28 May 2018

On 5 April, French-Italian computer analyst and former HSBC employee Hervé Daniel Marcel Falciani was arrested in Madrid. He was accused of leaking the names of over 130,000 possible tax evaders, clients of HSBC’s Swiss subsidiary, in a document known as the “Falciani List”. The people named included 659 alleged tax evaders from Spain.

Spanish police had been looking for Falciani ever since an international arrest warrant issued by Switzerland was received in Spain on 19 March 2018.

The day after his arrest, Central Examining Court 6 of the Spanish National High Court ruled provisionally to release Falciani without bail, pending the extradition process. However, the judge did impose certain precautionary measures, including the obligation to report weekly to the police, daily surveillance of Falciani’s home by the local police, a ban on his leaving his town of residence and, finally, confiscation of his passport and a ban on his leaving Spanish territory without court authorisation. The provisional release ruling can be downloaded by clicking on the link below.

In the trial held in 2015, Falciani was sentenced in absentia by the Federal Criminal Court of Switzerland to 5 years’ imprisonment for industrial espionage (a crime typified in the Swiss Criminal Code), but was acquitted of disclosing banking secrets.

By virtue of the international arrest warrant issued on 19 March, the Swiss judiciary now wants Falciani extradited to serve his sentence in Switzerland. The extradition process will be conducted by the National High Court of Spain in accordance with the European Convention on Extradition of 13 December 1957 (applicable between Spain and Switzerland) and with Spanish Law 4/1985 regarding Passive Extradition.

After having decided to release Falciani pending the final ruling on his extradition, the next step Central Examining Magistrate’s Court 6 had to take was to contact the Swiss authorities and ask them to forward the case details and formalise their request. The European Convention on Extradition prescribes a maximum period of 40 days for this documentation to be sent to Spain (Art. 16.4).

On receipt of the formal request and the corresponding documentation, the Ministry of Justice and the Spanish Government had another 40 days in which to decide whether or not extradition proceedings are justified. The Spanish Government recently granted the continuation of the proceedings and communicated this decision to the Central Examining Magistrate’s Court who has summoned Mr. Falciani for a hearing that will take place today, 28 May 2018. If, during that appearance, the respondent expresses his opposition to the extradition, the court will refer the case to the Criminal Division of the National Court, which will issue a ruling on whether the extradition is admissible or not.

Notwithstanding, even though the Criminal Division of the National High Court declares the extradition admissible, it will be the Government which finally decides to extradite the sought person or to refuse the request. The court ruling is not binding on the Government, which may refuse extradition, in its exercise of national sovereignty, for reasons of reciprocity, security, public order or other interests vital to Spain. The Government’s decision will be unappealable (Art. 6 of Law 4/1985 on Passive Extradition).

Hervé Falciani had already been arrested, at the request of Switzerland, once before, in Barcelona in July 2012. On that occasion he was detained in prison by order of the National High Court and subsequently granted provisional release in December of that same year. In May 2013 the National High Court rejected his extradition to Switzerland, considering that Falciani had reported “activities of dubious legality which may even constitute criminal offences, and for which legal protection is in no way whatsoever applicable”, and also that, in Spanish law, “no specific legal protection exists for banking secrets as such, and even less so when their disclosure is considered merely a formal offence”.

For Falciani’s defence, their client’s extradition was settled by the Spanish courts in 2013 with their ruling to reject the extradition request, and reopening the process for the same reasons would violate the principle of non bis in ídem, and should be considered res judicata.

If Spain’s National High Court accepts the argument put forward by Falciani’s defence, it may again reject his extradition.

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Recorded in the Madrid Companies Register in volume 34.303, of the 8th Section, sheet 131, page number M-617104.