Published on swissInfo.ch, by Matthew Allen, Dec. 21, 2011.
Some 11 Swiss banks must hand over thousands of client names and pay billions in fines to avoid tax evasion prosecution in the United States, according to reports. Swiss newspapers claim the deadline for the US ultimatum passed on Tuesday night. However, banks are keeping tight lipped over claims that they would also have to provide all correspondence with offshore clients over the past 11 years.
The Department of Justice (DoJ) has been steadily closing a net around Swiss banks ever since UBS admitted in 2009 to helping wealthy US citizens evade taxes. The Swiss authorities were then compelled to water down banking secrecy laws by handing over the names of nearly 4,500 UBS clients.
Since then, the DoJ and the US tax authority – the Internal Revenue Service (IRS) – have been building cases against other Swiss banks that are alleged to have either opened secret accounts from scratch or poached UBS clients who wanted to dodge the crackdown.
Two tax amnesties have netted thousands of clients, some of whom have provided the IRS with details of how they opened their accounts and a so-called roadmap of which banks allegedly helped them evade taxes.
Hopes dashed: … //
… Little legal redress:
Banking clients can expect little protection from the Swiss courts despite the strong tradition of legal banking secrecy in the country.
Under the terms of the UBS deal which was ratified by the Swiss parliament in 2010, the US authorities could legitimately demand information from other banks that demonstrate “behavioural patterns” of tax evasion.
Some 380 UBS clients appealed to the courts against the handover of their details to the US authorities, but only 100 cases were upheld – some of them only partially.
On Tuesday, a Swiss court rejected an appeal by a Credit Suisse client for more time to prepare a legal defence against the handover of his confidential data, according to the Reuters news agency. (full text).