London-based banking giant HSBC has agreed to pay €267.5 million ($312.33 million) to the French Treasury to resolve a legal case related to fraudulent dividend tax payments, according to a statement from the French financial prosecutor’s office on Thursday.

---

Details of the Settlement

The settlement concludes an investigation into HSBC’s tax compliance practices concerning dividends in France. Under the agreement, HSBC will pay the total amount to the French authorities, effectively resolving the dispute without further litigation.

The payout, equivalent to $312 million, reflects HSBC’s willingness to settle the case and avoid prolonged legal proceedings, while ensuring full compliance with French tax regulations.

---

Background on the Case

The French financial prosecutor’s office initiated the inquiry after detecting irregularities in dividend tax payments handled by HSBC. Dividend tax fraud cases typically involve banks or investors claiming tax rebates or exemptions without proper entitlement, leading to potential financial losses for national treasuries.

By agreeing to this settlement, HSBC aims to reinforce its commitment to regulatory compliance in France and maintain its reputation in European markets.

---

Impact on HSBC

While the payment is substantial, analysts suggest the settlement is unlikely to significantly affect HSBC’s global financial performance. The move reduces legal uncertainty and allows HSBC to focus on its broader business operations, including investment banking, wealth management, and retail banking activities across Europe and Asia.

---

Broader Implications

This case underscores the ongoing regulatory scrutiny faced by multinational banks in Europe regarding tax compliance. Financial institutions are increasingly expected to adhere to strict reporting and payment requirements, with penalties for non-compliance reaching hundreds of millions of dollars in high-profile cases.