Financial Regulatory Forum

ANALYSIS-Pressure mounts on Swiss private banks

By Lisa Jucca and Rupert Pretterklieber

ZURICH, Feb 2 (Reuters) – Swiss private bankers say attacks on the country’s treasured bank secrecy law turned 2009 into an “annus horribilis.”

A fresh German offensive against tax cheats does not make 2010 look any better for the key guardians of Switzerland’s multi-trillion-dollar wealth management industry.

Despite a settlement in the United States aimed at ending a tax probe against Swiss bank giant UBS and Switzerland’s pledges to help foreign authorities hunt down tax dodgers, the pressure on already weakened Swiss bank client confidentiality refuses to subside.

Germany’s announcement on Monday that it was prepared to pay for data on clients of a Swiss bank touted by a whisteblower has sent shivers across Swiss banking.

“This is a case that affects the whole of the Swiss financial market place because confidentiality and privacy is one of the pillars of the Swiss private banking model,” said Rainer Skierka, senior analyst at private bank Sarasin.

Swiss minister sees economic risk in U.S. tax dispute over UBS, shares fall

By Lisa Jucca

ZURICH, Feb 1 (Reuters) -¬†Shares in UBS AG fell to a 6-1/2 month low on Monday after the justice minister underscored the risk to the Swiss economy should the bank’s settlement of a U.S. tax dispute unravel.

Traders said news Germany was considering buying data of 1,500 possible tax evaders with Swiss bank accounts from an informant also weighed on the shares.

UBS settled a damaging tax row with the United States in August by agreeing to transfer data on 4,450 clients to U.S. tax authorities. But that deal is in question after a Swiss court ruled last month that most of the data cannot be transferred.

Switzerland, France settle dispute over tax records

DAVOS, Switzerland, Jan 27 (Reuters) – Switzerland and France settled a row over stolen bank records on Wednesday that was blocking a treaty aimed at helping Paris catch tax cheats.

Switzerland said in December it would freeze the tax treaty talks after French authorities obtained tax-sensitive client information from a former HSBC employee, which it said helped identify 3,000 suspected French tax evaders.

“We have found an agreement,” Swiss Finance Minister Hans-Rudolf Merz said after talks with French Budget Minister Eric Woerth on the sidelines of a World Economic Forum meeting.

Swiss government moves to save UBS tax deal

BERNE, Jan 27 (Reuters) – The Swiss government is to talk to the U.S. authorities in a bid to resolve a legal impasse that has threatened to derail a key tax deal over UBS client data, it said on Wednesday.

A UBS client last week won a Swiss court appeal to prevent her account data from being given to the U.S. taxman, throwing doubt on Switzerland’s ability to deliver details of 4,450 UBS client accounts to U.S. authorities as agreed in August.

“The cabinet is convinced that it can definitively overcome the continuing legal and sovereignty conflict with the United States with all its damaging consequences for Switzerland’s economy and as a financial centre,” the government said.

UBS client wins Swiss appeal against data handover, tax deal in question

ZURICH, Jan 22 (Reuters) – A client of Swiss bank UBS won an appeal to prevent her account data being handed over to U.S. authorities as part of a deal to give details on 4,450 clients to the U.S. taxman, a court said.

The Swiss administrative court said on Friday the existing double taxation agreement with the United States only allowed for data to be disclosed in cases of “fraud or the like”.

While the pilot case throws doubt on whether Switzerland will be able to hand over all of the 4,450 accounts the United States wants, an alternative criterion allowing for the deal to stand if at least 10,000 clients come forward voluntarily could make this irrelevant.

UBS won’t sue its former executives on subprime, U.S. tax

By Emma Thomasson

ZURICH, Dec 15 (Reuters) – UBS AG will not sue its former bosses after risky bets on subprime mortgages and a strategy of helping U.S. clients dodge taxes by hiding money in secret accounts brought the Swiss bank to its knees.

Zurich state prosecutors also said they would not open criminal proceedings against UBS employees as there was no evidence of a breach of Swiss law.

UBS said bringing charges would only draw negative attention as the wealth management group seeks a fresh start to win back trust after massive withdrawals by rich clients.

Experts say US tax disclosure bill could deter foreign capital

By Karey Wutkowski
WASHINGTON, Nov 5 (Reuters) – Tax experts on Thursday raised concerns that pending U.S. legislation to ramp up disclosure of offshore accounts could scare away foreign capital.

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Swiss hunt Italian agents as tax row deepens

ROME, Oct 29 (Reuters) – A row between Italy and Switzerland over tax evasion deepened on Thursday with one Swiss region launching a hunt for Italian agents trespassing on its soil as Rome warned against retaliation for its raids on Swiss banks.

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U.S. serves tax probe subpoenas in NY area

By Kim Dixon
WASHINGTON, Oct 28 (Reuters) – The U.S. government has served subpoenas on wealthy individuals in recent days in the New York area, targeting those who may have evaded taxes using offshore accounts at Swiss bank UBS AG, lawyers said on Wednesday.

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Swiss call in Italian envoy to explain bank raids

ZURICH, Oct 28 (Reuters) – Switzerland has summoned the Italian ambassador to demand an explanation of raids by police and tax inspectors on dozens of Swiss banks in Italy, the Swiss Foreign Ministry said on Wednesday.

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