A Montreal firm specializing in trusts will be forced to transmit to Paris information on wealthy French clients who have entrusted them with their millions, sheltered from capital tax, confirms a Supreme Court ruling on Thursday.
Blue Bridge Trust Company has exhausted all remedies. The country’s highest court is refusing to hear its appeal of lower federal court decisions. They allow Canada to send complete information to France on the 14 trusts administered by this firm, owned by Montrealer of Swiss origin Alain E. Roch.
In Canada, a Federal Court confidentiality order prohibits the media from identifying the wealthy taxpayers involved, but not in France. The judgment comes moreover three days after the publication in Release a vast investigation into the use of Blue Bridge trusts by large fortunes in France.
The Parisian daily names a series of wealthy clients of the company in Montreal, including a famous family active in the French film industry, artists as well as descendants of wealthy industrial and aristocratic families from across the Atlantic.
According to Release, Blue Bridge would have been used to put no less than 4 billion euros (nearly 6 billion dollars) in the shelter of Quebec trusts. His wealthy clients would have used them to evade French wealth tax.
PHOTO FROM BLUE BRIDGE WEBSITE
Alain E. Roch
The Journal of Montreal had also dealt with this case in articles from 2019, but without being able to mention the names of French taxpayers either, given the Canadian confidentiality order already in force at the time.
Alain Roch, lawyer Jules Brossard and Blue Bridge also made the headlines when the Panama Papers were published in 2016. The Toronto star had identified them among the main Canadian intermediaries of the Panamanian firm Mossack Fonseca, at the center of the revelations of the International Consortium of Investigative Journalists on tax evasion.
A decade of initiatives
France has been interested since 2012 in the trusts then managed by Alain Roch and Jules Brossard, as part of tax audits. The Republic demands full information on these structures by virtue of its international tax cooperation agreements with Canada.
Alain Roch, Jules Brossard and Blue Bridge initially partially collaborated with the authorities. From 2016, however, they have increased the number of appeals to different courts to avoid having to transmit this information. In essence, their lawyers argued that local laws forbid them from disclosing this information to France and that this country did not have the right to tax the capital of Canadian trusts.
In 2020, the Federal Court ruled in favor of Ottawa, which demanded this information for France. The Blue Bridge company, however, challenged the decision to the Court of Appeal, then to the Supreme Court, where it also just lost.
No comments
Alain Roch did not want to comment. His representative at the National public relations firm, Daniel Richard, however sent Press responses “forwarded to Release recently “.
These notes specify in particular that the French National Financial Prosecutor’s Office, which investigates serious economic crime, spoke with Alain Roch in December 2019, but without saying for what purposes. “It would not be appropriate for us to speculate on the reasons that led to the interrogation of Mr. Roch in December 2019,” said one of the responses.
The text explains, however, that an ongoing dispute in France aims to determine whether the Republic can demand wealth tax from a Canadian trust.
“Indignation” in Paris
The French Minister of the Economy, Bruno Le Maire, had expressed his “indignation” concerning this affair, after the publication of the articles of Release.
“I share your indignation on the question underlined by the ISF and on the litigation that we have with the Canadian trusts”, declared Bruno Le Maire in response to a question from a deputy before the Economic Affairs Committee of the Assembly national, according to Agence France-Presse.
He claims to have “launched all the procedures for several years” to “obtain information from the Canadian authorities”.
An AMF investigation failed
The Autorité des marchés financiers began investigating in 2015 a company of Alain E. Roch that allegedly managed the billions of its clients without a license for years, but it ultimately never filed charges.
The firm in question, Blue Bridge Wealth Management, owns the Blue Bridge Trust Company, which is the target of the French tax authorities’ demands on its wealthy clients.
“Numerous and detailed verifications over a period of two years followed with the tax authorities and police forces to shed light on these allegations,” explains Sylvain Théberge, director of communications, in an email to Press. The Autorité also entrusted an independent firm of accountants with the mandate to validate that the internal controls put in place by Blue Bridge Wealth Management were sufficient to ensure that it complies with its tax obligations. ”
At the end of this investigation, “no offense was noted and none of the allegations received could be demonstrated”, writes the spokesperson.
In 2018, Blue Bridge and the organization nevertheless signed a “standardization agreement”, in which Alain E. Roch’s firm acknowledged “having resorted to an illegal practice of trust company activities”, explains the Authority ( AMF). “This agreement was accompanied by an administrative penalty of $ 180,000, an amount established according to the laws in force at the time,” explains Sylvain Théberge.
The financial industry watchdog does not explain why its investigation was unsuccessful, as Blue Bridge has finally admitted to running illegitimate trusts. Since the signing of the agreement, the firm can conduct its activities legally.
Contacted about this, the office of Minister of Finance Eric Girard, head of the AMF, first stressed that the agreement between Blue Bridge and the Authority had been made under the leadership of former liberal minister Carlos Leitão. His photo also illustrated an article by Release December 14, titled “In Quebec, the strange passivity of the supervisory authorities”.
In addition to this remark, the office of Minister Eric Girard sent by email exactly the same information as the AMF.
With Agence France-Presse