Switzerland to help banks avoid U.S. tax charges
By Emma Thomasson
ZURICH (Reuters) - Swiss banks will be allowed to cooperate with U.S. authorities under a government plan agreed on Wednesday aimed at saving the industry from criminal charges of helping Americans evade tax.
U.S. authorities want Swiss banks to pay fines potentially totaling $10 billion and hand over the names of Americans it suspects of using secret accounts to evade tax, but strict secrecy laws stop the banks from complying.
The Swiss government said it had agreed the parameters under which banks could cooperate and said they could apply for individual permission to allow them to settle tax investigations, though they would not be allowed to hand over client names.
But banks will be allowed to reveal information - such as details of accounts moved to other banks, names of bank staff, lawyers and accountants - that would help U.S. authorities identify wealthy clients who are evading taxes, without naming them.
Yet government permission is likely to be tested in court by bank staff seeking to hold up the transfer of their names.
"The government will have to be careful about what data it authorizes banks to pass to the U.S. authorities," said Douglas Hornung, a Geneva-based lawyer acting for a former Credit Suisse CSGN.VX employee who is challenging the transfer of his data.
The Swiss parliament last month rejected legislation that would have made such legal challenges harder and helped to speed up the transfer of data.
The government, which has been trying to reach a deal for the banks for three years, has warned that the patience of the U.S. authorities is running out, risking a repeat of the indictment which felled private bank Wegelin earlier this year. Continued...