From yesterday’s Times—interesting ongoing case about the Swiss bank UBS, the world’s largest private bank, which agreed to pay $780 million “to settle accusations that it used undisclosed offshore private banking services to help wealthy Americans evade taxes.” The Justice Department is trying to force UBS to disclose 52,000 of its U.S. clients’ names, which could be very juicy. Don’t you want to know who they are, how much money they have in UBS, and how much in taxes they have evaded? Well–these folks don’t want you to know.
Group of Rich Americans Sues UBS to Keep Names Secret in Tax Case
By LYNNLEY BROWNING | February 24, 2009
UBS was sued on Tuesday in a Swiss federal court by wealthy American clients seeking to prevent the disclosure of their identities as part of a tax-evasion investigation by the United States Justice Department.
The lawsuit accuses UBS and Switzerland’s financial regulator, the Swiss Financial Market Supervisory Authority, or Finma, of violating Swiss bank secrecy laws and of conducting what Swiss law considers illegal activities with foreign authorities. It also named Peter Kurer, the chairman of UBS, and Eugen Haltiner, the chairman of Finma, as defendants.
The suit, filed by a lawyer in Zurich, Andreas Rued, on behalf of nearly a dozen American clients, underscores the growing clash between Swiss banking secrecy laws and those of the United States. Tax evasion is not considered a crime in Switzerland. Disclosing client names under Swiss law is a criminal offense and can expose bank executives and officers to fines, prison terms and other penalties.
UBS is the world’s largest private bank and Switzerland is the world’s largest offshore tax haven, with trillions of dollars in assets.
The lawsuit, which UBS described in an internal memo late Tuesday, stems from UBS’s agreement last week to turn over to federal authorities in Washington the names of 250 wealthy Americans suspected of using secret UBS offshore accounts and entities to evade taxes.
UBS reached a $780 million deferred-prosecution agreement to settle accusations that it used undisclosed offshore private banking services to help wealthy Americans evade taxes. But the bank is still under scrutiny by the Justice Department, which is seeking to force it to disclose the names of the 52,000 American clients it suspects may have evaded taxes.
Mr. Rued could not be reached for comment.
[This is the full article.]