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Nearly a Year into Bank Secrecy Crack Down, Little Progress Seen
By Colby Adams
printInternational efforts to crack down on bank secrecy abuse remain stymied, with few tax evaders opting to move their money out of traditional European and offshore tax havens, according to analysts. The stasis is in spite of an April statement by Group of 20 leaders that "the era of banking secrecy is over" and the high-profile wrangling between the U.S. Justice Department and UBS AG to turn over the names of at least 52,000 possible tax evaders. The Swiss bank agreed in August to turn over the information on 4,450 of the suspect accounts. The United States is one among...
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A Geneva court's ruling clearing the way for bankers to know whether their employers have identified them to American investigators threatens to complicate a negotiated U.S.-Swiss tax deal, say sources.
Swiss financial institutions will likely exploit gaps in a bilateral agreement between the United States and Switzerland to preserve bank secrecy for their clients, says the bestselling author of a book on money laundering.
An expected pitch Friday by Switzerland's executive branch to clear the way for banks to share data with the United States is likely to face stiff domestic challenges, say Swiss attorneys.
A plan to require member-states of the European Union to automatically exchange tax-related data in an effort to boost government revenues is likely to face political and logistical challenges.
The indictment of a now-defunct Swiss financial institution and threatened charges against the country's largest publicly-owned bank fueled Switzerland's decision last month to seek a broad data-sharing agreement with American officials.
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As settlement negotiations with Swiss banks continue, the IRS is turning its attention to jurisdictions outside of Europe, including two set to eclipse Switzerland as the world's top secrecy havens.
Account activity related to efforts to evade paying child support, hide assets from a spouse or dodge a tax lien could warrant a suspicious activity report, even if the funds involved are ostensibly of legal origin, say former and current compliance officers.
Information on tax evasion and asset recovery cases will likely top data-sharing requests filed by foreign governments with the United States over the next three to five years, say analysts.
Plans to make tax evasion a predicate crime of money laundering will likely be successful despite speculation that broader financial regulatory reform is foundering, say Capitol Hill staffers.
As many as a dozen countries are expected to press UBS AG for information on tax evaders following the bank's settlement last week with the United States, say tax analysts.
The United States and UBS AG said Wednesday that they had reached an agreement over whether U.S. investigators could access data on the bank's tax evading American clients.
Bank secrecy jurisdictions have lobbied behind the scenes to weaken a United Nations call for greater international cooperation on tax evasion expected to be issued this week, say tax policy analysts.