Secrecy trouble for Swiss Banking.

This is the second and concluding article on the confrontation between the U.S. and Switzerland on the matter of the secrecy laws governing Swiss banking.

For the Swiss running a Bank without the aid of secrecy laws, is like trying to make chees without milk. Can be quite confusing! Secrecy has been the major attraction of Swiss banking and its engine for growth over the centuries.
Now with unrelenting pressure from the U.S. to disclose the names of about 52,000 American citizens holding secret accounts with the Swiss banking giant, the Union Bank of Switzerland, the Swiss are at their wit’s end on how to deal with this threat to their survival as secret bankers to the world.
The Swiss Government holds that the UBS would be violating Swiss laws by making the above disclosure about its U.S. clients. And that it might be constrained to intervene in the matter by seize the relative records before they are handed over to the U.S. authorities. But the fact is that UBS has already pleaded guilty to the charges leveled against it by the U.S. Government of aiding and abetting tax evasion by its citizens, and has also agreed to pay penalties of USD 780.00 million to the U.S. What’s more, it even admitted to it’s personnel visiting the U.S. to solicit such business.
Having thus admitted to being party to violation of U.S. Tax laws, the Swiss have a weak case going for them, when they cite the violation of their own laws in regard to the disclosure, the U.S. has demanded. And the Americans are not letting of this opportunity, with the State Department, the Treasury, the Justice Department, and the IRS co-ordinating their efforts to nail the Swiss banking system.
The U.S., in fact, has registered partial success in the case, by prying out the names and account details of 250 to 300 of its citizens maintaining secret accounts with the UBS. Having tasted blood, the the Americans want more. And the Swiss, on their part, are not at all secretive of their resentment of this.

Concluded.

Secrecy trouble for Swiss Banking.

Think of Switzland, and the images that flash across your mind are that of scenic beauty, cheese, and chocolates. But for the money-minded, especially those who value secrecy, whether legal or questionable, it is Swiss banking that comes to the mind. Switzerland is the perfect hideaway, for money, whether legal or otherwise.
Banking has been the cornerstone of the Swiss economy for centuries. Anc secrecy the grease that has kept the institution of Banking going on smoothly, without so much as murmur, all these centuries.
All that is now under sever strain, and Swiss banking is facing the most serious and potent threat to its very existence. Ever since money laundering and terrorist financing became an international issue, offshore financial centers offering secret accounts, and not burdening their clients with too much of legalese, have been facing the heat. Accused of aiding and abetting tax evasion by foreign citizens by encouraging them to park their funds with them, Swiss banks are now encircled with international laws and lawmakers that are determined to break the backbone of Swiss banking by bringing them in alignment with regular banking laws prevalent elsewhere.
Right now, the U.S. and Switzerland are in the midst of a royal row with the U.S. trying its best to get hold of details of about 52,000 of its citizens maintaining accounts with Union Bank of Switzerland, and said to have violated U.S. tax laws. And on its part, Switzerland is throwing everything in its armory to stave off what could turn out to be the death blow to its Banking industry.
The U.S. Justice Department is going all out against the Swiss Banking giant with the IRS providing ammo in the form of the “John Doe summons” that entitles it to obtain the names of American citizens who are likely to have broken U.S. tax laws, by taking advantage of offshore accounts, like in the above case with the UBS.
To be concluded.