• The National Financial Prosecutor's Office (PNF) announced on Wednesday that it had opened an investigation on March 31 for "aggravated laundering of tax evasion" after the publication of a Senate report pointing to the proliferation of State contracts with consulting firms.

  • Among these companies is McKinsey, which notably advised the government on the vaccination campaign.

    The French subsidiaries of the American company would not have paid taxes between 2011 and 2020, according to the commission of inquiry, which suspects them of "tax optimization".

  • The investigations were entrusted to the Financial Judicial Investigation Service (SEJF), nicknamed "the Bercy police", a service created in 2019.

After weeks of controversy and a few days before the first round of the presidential election, justice is putting its nose in the accounts of McKinsey.

On Wednesday, the National Financial Prosecutor's Office (PNF) announced that it had opened an investigation on March 31 for "aggravated laundering of tax evasion", after the publication of a Senate report on consulting firms.

20 Minutes

takes stock of this case to help you see more clearly.

  •  Why was an investigation opened?


The opening of the PNF investigation follows the publication, on March 16, of the report of the Senate commission of inquiry into the influence of private consulting firms on public policy.

According to this report, government spending in the area has increased from 379.1 million euros in 2018 - contracts awarded before Emmanuel Macron's five-year term - to 893.9 million euros in 2021, more than double. .

Among the consulting firms cited in the report are in particular the French entities of McKinsey, an American company.

Mandated by the State for assessment missions on the APL reform, the pension reform or more recently on the management of the coronavirus, the firm is suspected of having made "tax optimization" in order not to pay d taxes in France.

According to the report, between 2011 and 2020, McKinsey's French subsidiaries paid no corporate tax, even though their turnover in the territory reached "329 million euros in 2020, of which approximately 5% in the public sector,” the Senate said.

  •  What exactly is the McKinsey firm accused of?


Although the PNF does not mention McKinsey directly in its press release, the firm is suspected of tax optimization via the well-known "transfer pricing" mechanism: "It seems that McKinsey's parent company in the United States , which is located in Delaware, a tax haven, has overcharged services to its French entities, crushing the profits made in France.

De facto, it reduces or eliminates their taxation, ”explains Sophie Alexander, lawyer specializing in tax law at the Cadji firm.

If this practice is legal, companies must respect competitive prices.

“The tax authorities will check whether this invoicing is in line with the prices practiced on the market”, continues the lawyer, who adds: “It is not because they are related companies that they have the right to overcharge.

»

  •  What is the company risking?


To fully understand the challenge of this investigation, it is necessary to distinguish between the two parts, the tax part and the criminal part, recalls Sophie Alexander.

“On the tax side, the administration will check whether there has been overbilling.

If this is the case, it will establish the amount of tax that McKinsey should have paid and there will be an adjustment, or even possibly a tax penalty, ”explains the lawyer.

On the criminal side, “the investigation must demonstrate if there is a fraudulent intention in the assembly, that is to say if there is a deliberate will to defraud.

If this is the case, it is tax evasion and the company risks substantial fines.

It can even go as far as prison sentences for the leaders, ”according to the specialist.

  •  Who is in charge of the investigations?


In its press release, the PNF specifies that the investigations have been entrusted to the Financial Judicial Investigation Service (SEJF).

This “tax police”, created in 2019, acts under the supervision of the Ministry of Action and Public Accounts.

"It's a financial brigade attached to the PNF, whose investigators have financial and tax skills," explains Sophie Alexander.

The latter often work in pairs, adds Arnaud Tailfer, tax lawyer at Arkwood.

"It is often a former public finance officer and a judicial police officer (OPJ) who has undergone training in taxation", details the specialist, who specifies that these investigators have the same means at their disposal. that the police: “They can carry out searches and they can take people into custody.

" " The file was not entrusted to just anyone.

These investigators are the warriors of financial fraud,” adds Sophie Alexander.

  •  Why do we speak of “aggravated laundering of tax evasion” and not of “tax evasion”?


If the senators suspect McKinsey of having made “tax optimization”, why was the investigation not opened for “tax evasion”?

Blame it on the “Bercy lock”, according to Arnaud Tailfer, the device which frames the criminal prosecution of perpetrators of financial offences.

Only the tax administration can lodge complaints of tax evasion with the public prosecutor's office.

While it is true that this “lock” was partially lifted in 2018 – the tax authorities must now automatically transmit tax adjustments of more than 100,000 euros to the prosecution – it is more “an adjustment than a lifting “, tempers the lawyer.

Our dossier on McKinsey

If the public prosecutor's office cannot therefore take the lead on tax evasion, the same cannot be said for the offense of money laundering: "The PNF cannot seize tax evasion on its own, it can only be seized by a complaint or by facts denounced by the tax authorities.

On the other hand, he can self-seize for acts of money laundering”, deciphers Arnaud Tailfer, recalling a case law of the Court of Cassation of 2008 “which considers that money laundering is an autonomous offense because it differs from tax fraud”.

"Somewhere, the prosecution bypassed the tax administration" by opening this investigation, adds the specialist.

Given the complexity and size of the case, there is no doubt that we will have to wait for the next five-year period to know the legal consequences.

Economy

Presidential 2022: 5 graphs to understand the McKinsey affair and the use of consulting firms in France

Elections

Presidential 2022: Emmanuel Macron's campaign polluted by the McKinsey affair

  • Justice

  • Investigation

  • tax evasion

  • Whitening

  • McKinsey

  • Bercy

  • parquet

  • Government

  • Taxes

  • Advice