Julius Baer is the third Swiss bank to take in a request to reveal American client data (sporst via Flickr Creative Commons)
The United States has increased pressure on Switzerland to find a lasting solution to the tax evasion row between the two countries by demanding information on Julius Baer bank clients suspected of dodging taxes.The US request for administrative assistance was made to the Swiss authorities under the terms of an existing double taxation agreement. Julius Baer has confirmed that it is the third Swiss bank to be targeted by the US in such a way following earlier requests for data relating to UBS and Credit Suisse clients.
Switzerland is also negotiating a separate deal with the US that aims to put an end to intrusive demands for information and a growing list of criminal proceedings against Swiss banks and their employees. Swiss Finance Minister Eveline Widmer-Schlumpf said recently that Switzerland was “on the point of presenting a solution” to the ongoing tax evasion row following several years of negotiation.
In the meantime, US authorities have shown no signs of relaxing their investigation into around 13 Swiss banks that are strongly suspected of aiding and abetting US tax evaders.
The latest official request for information follows the indictment of a Swiss banker and lawyer by a Manhattan court in April.
Seeking resolutionThe Swiss financial sector has also expressed impatience at finally finding a lasting solution that covers both future tax relations between the two countries and resolves the legacy issues of the past.
“It’s in the best interest of the financial sector and each individual bank to resolve the US issue quickly and completely,” Urs Rohner, chairman of the board of directors at Credit Suisse, told the Neue Zürcher Zeitung newspaper on Tuesday.
“A solution that seems painful at first sight is better than no solution,” he added. “To believe that one can push this issue to the back burner and that it will dissolve over time is unrealistic. That will not happen.”
Switzerland’s banking sector has been under enormous pressure from the US since UBS was caught red-handed helping tax evaders in 2009. The bank was forced to pay a huge fine and hand over thousands of client files to the US tax authorities, effectively ending Switzerland’s long-standing tradition of strict banking secrecy.
Last year Switzerland’s oldest private bank, Wegelin, collapsed under the weight of a US prosecution after poaching American clients from UBS and offering a sanctuary for their undeclared assets.
The European Union is also queuing up to negotiate Switzerland’s implementation of amendments to its Savings Directive, which would enforce similar conditions on financial entities as those sought by the US.