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Alleged LuxLeaks source Antoine Deltour comes forward, begins trial

Antoine Deltour a 28-year-old French national and former PricewaterhouseCoopers employee, has come forward as one of the alleged sources of the International Consortium of Investigative Journalists’ (ICIJ) LuxLeaks release. Deltour went public in an interview with French newspaper Liberation on Sunday.

Deltour joined PricewaterhouseCoopers as an auditor in 2008, aged 22, and resigned two years later. Before leaving, he came across evidence of complex tax arrangements PwC negotiated for clients with the approval of Luxembourg’s authorities and made copies of them. As Deltour explained to Liberation:

I copied training documents, but while searching the PwC database, I also came across these famous tax rulings. Without any particular intention or precise plan, I copied these also because I was appalled by their content.

According to a new website set up by his support committee, Deltour was contacted by a journalist in summer 2011 and the copied documents formed the basis for several broadcasts on French television the following spring. PwC made a criminal complaint in June 2012, following the broadcast.

Over two years later, Deltour is one of the alleged sources of the ICIJ’s LuxLeaks. A first tranche of documents, released on 6 November, concerned tax avoidance negotiated by PwC with a second release this month broadened the scope of the investigation to the rest of the big four accountancy firms.

LuxLeaks follows another large tax-related investigation by the ICIJ, Offshore Leaks, which was based on a 260 GB hard drive posted anonymously to a journalist. Many of these records are now available online.

Tax avoidance has become a highly controversial issue in the EU, where people are facing consecutive years of reduced public spending under austerity budgets. LuxLeaks has proven to be particularly contentious in Brussels as the new head of the European Commission, Jean Claude Junker, was the prime minister of Luxembourg at the time critical elements in its tax regime were enacted. Junker now faces a vote of no-confidence and an inquiry into his involvement in systematic tax avoidance.

Deltour says he has not been involved with ICIJ directly and, in his Liberation interview, points out that some of the LuxLeaks documents are dated later than 2010.

I’m just part of a broader movement. In LuxLeaks 1 mentions several internal documents subsequent to my departure from PWC. I am not alone. In LuxLeaks 2 it comes to records controlled by the other members of the big four [of the financial audit]: Deloitte, KPMG, Ernst & Young.

It  is unfair that Luxembourg is the only country pilloried and that only  one audit firm is singled out because these practices are systemic. I do  not like the term tax optimization, it’s a euphemism for aggressive tax planning implemented by some states and complex strategies practiced at industrial scale by some firms. Regulation will always lag behind financial engineering.

Charged with theft, professional secrecy violations, trade sercecy violations and illegal acquisition of data, Deltour appeared before a judge on 12 December. Supporters are raising awareness about Deltour’s case. A petition for Deltour, who has garnered the support of a French coalition of NGOs Platform on Tax Havens and French judge Eva Joly, among others, has more than 2,000 signatures. As the supportive blog notes, Deltour could face prison time and a heavy fine.

We will report on further developments in Deltour’s trial as it unfolds.