Bank arrest fuels Belgian scandals

Click to follow
The latest in a string of bizarre Belgian scandals broke yesterday with the sensational revelation that the head of one of the biggest bank corporations in the Benelux area has been charged with criminal conspiracy and tax fraud on a massive scale. Katherine Butler reports from Brussels.

Damien Wigny, 55-year- old chairman of KB-Lux, the Luxembourg sister company of Belgium's Kredietbank, was arrested at the weekend for alleged collusion with Rita Verstraeten, a tobacco heiress already facing charges of defrauding the tax authorities to the tune of 2 billion Belgian Francs - about pounds 34m.

Mr Wigny, the son of Baron Pierre Wigny, a former Belgian justice minister, is officially a resident of Luxembourg. He was picked up on Saturday when he returned from the Grand Duchy to spend All Souls Day, a public holiday and a traditional family occasion, with relatives in Belgium. Belgian police had staked out the family residence at Perwez-Eghezee.

Investigating magistrates who have been following the money trail in the Verstraeten case for months believe Mr Wigny orchestrated a massive tax fraud scam. He is being held for suspected money laundering and on suspicion of heading a criminal conspiracy to defraud the tax authorities.

Jean-Claude Leys, the judge leading the investigation, said Mr Wigny is believed to have personally assisted Rita Verstraeten, a former hairdresser, to launder billions she inherited from cigarette magnate Roger Gosset in 1991 in a secret Luxembourg account.

The arrest will provoke renewed criticism of Luxembourg as a tax haven. The Grand Duchy is under intense pressure from other EU governments to bring its bank secrecy and taxation laws into line. But it has also shaken the powerful Belgo-Luxembourg banking world to the core. KB-Lux was being monitored closely by the Belgian tax and judicial authorities for at least three years. Up to 300 accounts held by Belgians in the Luxembourg bank have been investigated on suspicion of tax fraud.

Comments