Most Korean firms use UBS for bogus companies

August 10, 2013 Leave a comment

2013-08-09 18:00

Most Korean firms use UBS for bogus companies

By Kim Tae-jong
An activist group of journalists said Friday that most Korean firms used UBS, the biggest banking group in Switzerland, to set up paper companies in off-shore tax havens.
Newstapa, run by the Korea Center for Investigative Journalism, said 32 out of 369 paper companies in off-shore tax havens were set up for Koreans through UBS branches in Singapore and Hong Kong. Lee Soo-young, chairman and CEO of OCI, a major chemical firm, and Choi Eun-young, Hanjin Shipping chairwoman, are some of the Korean corporate executives who used UBS to establish paper companies in tax havens, it said. The number is much higher than comparable figures by other international banks including German-based Deutsche Bank with eight and Singapore-based DBS with seven. Newstapa argued that these international banks also created secret accounts for bogus firms by Korean customers. “The accounts with false identities would not have been possible without the agreement from each bank. We suspect those banks played an important role in supporting their Korean customers to dodge due taxes through paper companies,” an official from Newstapa said. But he said UBS denied the allegation, saying that it was not involved in any illegal services for Korean customers. The online news outlet, working with the U.S.-based International Consortium of Investigative Journalists, has revealed names of Koreans who allegedly set up paper companies in an apparent move to dodge due taxes and creating slush funds.

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