David Cameron has defended his Government's record on tackling tax evasion, after senior politicians and HM Revenue & Customs were accused of failing to act over claims that HSBC helped clients dodge payments totalling millions of pounds.
A furious blame game was under way between the Tories and Labour after a huge trove of files on secret Swiss accounts run by the bank was leaked.
The documents have already sparked criminal probes in several countries and attempts to claw back cash after being stolen by an IT worker in 2007 and passed to French authorities.
Now the details of 30,000 accounts holding almost £78 billion of assets are being revealed after they were obtained by a French newspaper and analysed by a team of investigative journalists.
They are reported - by BBC's Panorama and the Guardian - to include evidence that the bank colluded with some clients to hide accounts from tax authorities in their home countries.
Among those alleged to have been exposed as having accounts with the Swiss arm of HSBC are said to be politicians, sports stars and celebrities as well as criminals and traffickers.
Treasury minister David Gauke was called to the House of Commons to answer an urgent question from Labour about the official response to the leaked documents and Mr Cameron's decision in 2010 to appoint former HSBC boss Stephen Green to his Government as trade minister - a position he held until 2013.
But the Tories hit back pointing out that Ed Balls had been city minister in the period when tax evasion had been taking place.
The Prime Minister rejected criticisms of Lord Green's appointment and said that he had himself put action against tax evasion at the heart of the UK's presidency of the G8 group of leading economies in 2013.
Speaking during a visit to Chester, Mr Cameron said: "Stephen Green was an excellent trade minister, he did a good job. But I'd also add no Government has done more than this one to crackdown on tax evasion and aggressive tax avoidance.
"I put it absolutely at the head of my G8 agenda, to make sure there's more tax transparency, the big companies pay their taxes properly and that we raise money from people previously evading and avoiding tax and will go on doing that as a Government."
In the Commons, Mr Gauke told MPs: "Lord Green was a very successful trade minister. There is no evidence to suggest that he was involved or complicit with tax evasion activities."
However shadow treasury minister Shabana Mahmood said that Lord Green now needed to make a full statement as to what he knew about tax evasion activities at the bank and when he knew it.
"Any failure by this Government to question Stephen Green before his appointment would be an inexplicable and inexcusable abdication of responsibility," she added.
Holding a secret bank account is not illegal but they have been used by some to deliberately conceal assets to dodge tax, which is against the law.
HMRC, which was passed the data in 2010, has clawed back £135 million from some of the 3,600 Britons identified as potentially avoiding tax using the Geneva branch of HSBC. But only one prosecution has been brought.
Mr Gauke said that HMRC had received the data under "very strict conditions" which limited its use to pursuing offshore tax evasion
"Under these restrictions HMRC has not been able to seek prosecution for other potential offences such as money laundering," he said.
"However the French authorities have today confirmed that they will provide all assistance necessary to allow HMRC to exploit the data to its fullest."
The chair of the House of Commons Public Accounts Committee (PAC) Margaret Hodge said HMRC had not been sufficiently determined in tackling dodgy practices.
"You are left wondering, as you see the enormity of what has been going on, what it actually takes to bring a tax cheat to court," she said.
"If it had been a benefit cheat, it would have been up for court years ago. Now, we have had only one tax cheat taken before the British courts."
At a regular Westminster media briefing, the Prime Minister's official spokesman said Mr Cameron did not discuss the allegations against HSBC with Lord Green at the time of his appointment, but was unable to say when the PM and other ministers were made aware of the contents of the documents.
Asked whether the Prime Minister was disappointed that only one prosecution had been brought in the UK on the basis of the files, the spokesman said such decisions were down to the Crown Prosecution Service.
"The Government's job is to put in place the regulatory and legal regime. It must be for an independent prosecutor to take, on a case-by-case basis, its own decisions with regard to what cases are brought," he said.
"Tax evasion is always wrong. Rightly, HMRC pursues and investigates cases where there may be concerns about that and it should always do it robustly and forcefully, because tax evasion and aggressive tax avoidance are wrong."
Former chancellor Lord Lawson, who sat on the Parliamentary Commission on Banking Standards, said that banks like HSBC had grown too big and needed to be split up.
Lord Lawson told BBC Radio 4's The World At One: "I can't believe that Stephen Green, who amongst other things is an ordained Church of England priest, could possibly have known what was going on. But the fact that he, a very clever man, didn't know what was going on is very serious.
"I do think that banks are going to have to be split up - the big banks - so that they are less complex and not quite so big and so it is possible to manage them. I think that has to be done."
Liberal Democrat chief secretary to the Treasury Danny Alexander said: " Financial institutions who are proven to have colluded with tax evaders should face the full force of the law. We need to work with HMRC and regulators to make sure that they have all the legal and regulatory tools to tackle such situations.
"If that means a change in the law, or new powers for regulators, that is what we will do.
"We quite rightly prosecute and often jail people guilty of damaging our society through conventional crime and anti-social behaviour. The way we treat systematic tax evasion should be no different. If that means jail for offenders and those that conspire with them, then so be it.
"Over the last five years, thanks to the Liberal Democrats, we have taken unprecedented action to clamp down on tax avoidance and evasion. These practices are socially, morally, and economically unacceptable and I will continue to work to make sure that the law, and the way it is applied, reflects that."
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