The French unit of UBS AG has been placed under formal inquiry as part of an investigation started in 2012 over the practices conducted by the bank in France, according to a spokesperson.

According to Christopher Meier, spokesman for the bank based in Zurich, the unit would be cooperating fully with French authorities. He added that the French operations 'conducts its business in full compliance with French laws and regulations.'

The allegations included in the inquiry said that the biggest unit outside of Switzerland was complicit in the creation of a system that aimed to solicit from wealthy French citizens to open undeclared and undisclosed accounts in Switzerland. The said allegation were first reported by Agence France Presse, who cited an unnamed judicial source in France.

As for the investigation, UBS spokesperson Meier declined to make any comment on the matter.

The Swiss bank secrecy laws were instituted back in 1934 as a backlash to a tax evasion investigation from France. The case had the bankers from Basler Handelsbank were arrested in Paris back in 1932 after finding that the bank has helped French clients evade taxes.