UBS's offices in Frankfurt: a German probe into the bank could not come at a worse time (OKAPIA)
by Matthew Allen, swissinfo.ch
The revelation of a tax evasion probe in Germany and the guilty plea of a former banker in the United States this week shows that Swiss banks are not yet off the hook from ongoing global investigations.
The timing of the German probe into UBS could not come at a worse
time, with the country’s parliament due to decide on a contentious tax
treaty with Switzerland in two weeks. At the same time, a former UBS
banker has implicated ex-colleagues during his testimony to a US court.
UBS has confirmed media reports on Thursday that prosecutors from the German city of Mannheim opened an investigation earlier this year and conducted searches of its offices in Frankfurt.
It is not yet clear whether any alleged offences took place after Switzerland and Germany agreed in principle last year to a treaty that promises to clear up cross-border tax evasion.
In any case, critics of the “Rubik” treaty – including influential German political parties – have derided the withholding solution as being too soft on tax dodgers. Politicians will vote on whether to accept the deal later this month.
UBS has confirmed media reports on Thursday that prosecutors from the German city of Mannheim opened an investigation earlier this year and conducted searches of its offices in Frankfurt.
It is not yet clear whether any alleged offences took place after Switzerland and Germany agreed in principle last year to a treaty that promises to clear up cross-border tax evasion.
In any case, critics of the “Rubik” treaty – including influential German political parties – have derided the withholding solution as being too soft on tax dodgers. Politicians will vote on whether to accept the deal later this month.
Allegations flood in
On Tuesday, UBS received further bad news when a former advisor to
wealthy clients admitted to his part in aiding tax dodgers. He had been
held in the US under house arrest since January 2011.
The banker, who had also worked for Credit Suisse, implicated five more “egregious” UBS colleagues during his confession to a US court. He was released having been deemed to have served his sentence while under arrest.
Other fresh allegations of Swiss bank complicity in tax evasion scandals continues to come in thick and fast.
Suspicions do not fall on UBS alone. The French and German authorities conducted a series of raids on the offices of Credit Suisse in the summer while a Greek investigative reporter recently published a list of suspect accounts housed at HSBC’s Geneva private bank.
The US has several Swiss banks under the microscope, not least Wegelin, which collapsed in January under the weight of evidence from an investigation that has yet to reach a conclusion.
The banker, who had also worked for Credit Suisse, implicated five more “egregious” UBS colleagues during his confession to a US court. He was released having been deemed to have served his sentence while under arrest.
Other fresh allegations of Swiss bank complicity in tax evasion scandals continues to come in thick and fast.
Suspicions do not fall on UBS alone. The French and German authorities conducted a series of raids on the offices of Credit Suisse in the summer while a Greek investigative reporter recently published a list of suspect accounts housed at HSBC’s Geneva private bank.
The US has several Swiss banks under the microscope, not least Wegelin, which collapsed in January under the weight of evidence from an investigation that has yet to reach a conclusion.
End is nigh
The ferocity and endurance of the global campaign against tax evasion
prompted UBS chief executive Sergio Ermotti to pronounce banking secrecy
dead last month.
“I have said for a long time that banking secrecy, as we knew it ten years ago, is over,” he told the Tages-Anzeiger newspaper, adding that a “new strategy” was needed.
His comments would have infuriated rightwing politicians who refuse to let Switzerland’s cherished banking secrecy depart without a struggle.
Last month, an attempt to force a nationwide vote on scrapping the Rubik tax deals narrowly failed to pass muster. But pressure groups continue in their efforts to force Switzerland to fight outside pressure on its financial system.
“I have said for a long time that banking secrecy, as we knew it ten years ago, is over,” he told the Tages-Anzeiger newspaper, adding that a “new strategy” was needed.
His comments would have infuriated rightwing politicians who refuse to let Switzerland’s cherished banking secrecy depart without a struggle.
Last month, an attempt to force a nationwide vote on scrapping the Rubik tax deals narrowly failed to pass muster. But pressure groups continue in their efforts to force Switzerland to fight outside pressure on its financial system.
Matthew Allen, swissinfo.ch
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