Swiss financial regulator FINMA is pressing the nation’s private banks to decide if they will join the voluntary US tax disclosure program or risk costly prosecution for American tax evaders, writes Caroline Ng.
The news follows the tax evasion agreement the world’s biggest offshore wealth centre had earlier signed with the US Department of Justice on 29 August 2013 to end banking secrecy on undeclared American clients.
Go deeper with GlobalData
Access deeper industry intelligence
Experience unmatched clarity with a single platform that combines unique data, AI, and human expertise.
Finance minister, Eveline Widmer-Schlumpf, is addressing concerns over the program in parliament, in what some consider will be a heated debate.
Some politicians are calling for the program suspension until the US can offer clarity on how the automatic transfer of information will work.
The program is open to some 300 firms which are not part of the current US tax probes of some of Switzerland’s largest private banks, including Credit Suisse, Julius Baer and Pictet, but many are ambivalent on the decision.
"Probably a few dozen will risk being pursued by the US later and stay out of the current program altogether," a lawyer working for the Swiss banks was quoted as saying in Reuters.
US Tariffs are shifting - will you react or anticipate?
Don’t let policy changes catch you off guard. Stay proactive with real-time data and expert analysis.
By GlobalDataMeanwhile, banks with little exposure to US accounts may decide not to be part of the program.
However, pressure is mounting from US authorities to urge banks to cooperate as procrastination would stall existing tax probe settlement and risk banks to potential fines as high as 50% of a bank’s previously undeclared assets held by Americans.
FINMA has also earlier warned banks to fear US sanctions, underscoring Switzerland’s commitment to fight tax frauds.
