LUXEMBOURG: Luxembourg will on Tuesday put on trial three people behind the uncovering of the so-called LuxLeaks scandal that implicated the small European country in huge tax breaks for some of the world’s largest companies.
Whistleblower Antoine Deltour, a former auditor at services firm PwC, French journalist Edouard Perrin and Raphael Halet, another ex-PwC employee, face charges over the leaking of thousands of documents.
The LuxLeaks scandal erupted in Nov. 2014, exposing deals that saved firms including Apple, IKEA and Pepsi billions of dollars in taxes while European Commission President Jean-Claude Juncker was Luxembourg’s Prime Minister.
A series of global news outlets poured over 28,000 pages of documents obtained by the International Consortium of Investigative Journalists (ICIJ), revealing the full scale of the tax breaks won by 340 companies.
The leak was the biggest of its kind until the Panama Papers this year exposed links between a number of international leaders to offshore shell companies that can be used to launder wealth.
The trial is expected to last until May 4.
Deltour is accused of having stolen documents from the accounting firm before he left in 2010, revealing business secrets, violation of professional secrets and money laundering.
Halet, who is accused of being behind a separate leak, faces the same charges.
Perrin – who first broke the story in 2012 in a program on the state-owned France 2 TV station, two years before the scandal gained traction – is charged with being an accomplice in all the offences.
He is accused of having manipulated Halet into the second leak and having played an “active role” in the alleged crimes by the two PwC employees.
Deltour allegedly had access to the documents on the PwC database and copied them before he left the company six years ago, after which they became the basis of the France 2 report.
He faces between five and ten years in prison but has previously said he has no regrets. “I don’t understand how I could suffer a heavy penalty when I have acted in the public interest,” he said in one interview.
PwC has also launched civil legal proceedings.
The Luxleaks scandal put huge pressure on Juncker during his first weeks as head of the European Commission, the powerful executive arm of the 28-nation European Union.
The revelations about huge tax breaks ended up forcing the EU to take urgent steps to stop global firms avoiding tax in Europe, including anti-trust inquiries into firms like Apple, McDonald’s and Amazon.
The ICIJ trove contained many more documents, and not only from PwC but other accountancy and law firms involved in obtaining secret “tax rulings” that lowered tax rates for companies to as little as 1 percent.
Luxembourg authorities resumed investigations after the ICIJ released its documents, leading to Deltour being charged in Dec. 2014 for violation of professional secrecy and wrongfully accessing a database.
However the tiny duchy of Luxembourg has also tried to show that it is clamping down on tax evasion, as well as diversifying into other forms of industry.