Switzerland's politicians have voted to hand over the account details of 4,450 Americans suspected of using the country's banking secrecy laws to evade US taxes.
The knife-edge vote in the Swiss parliament ratifies a deal signed by the Swiss and US governments last year, and ends a two-year legal battle that had threatened the American operations of the Swiss banking giant UBS. The US tax authorities came after UBS when a whistleblower claimed its financial advisers were aiding massive tax evasion by some of its American clients. The bank has already paid $780m (£527m) and handed over details of hundreds of disputed client accounts in return for a deferred prosecution agreement.
The deal negotiated between the Swiss and US governments covered thousands more suspicious accounts, details of which were disclosed by UBS to regulators in Berne but not to the US authorities. Absent the deal, the US tax authorities were threatening to launch a further legal case against UBS in an attempt to win even wider disclosure – something that would have clouded UBS's future in the US and potentially caused a rupture between the US and Swiss governments.
The Swiss government characterised the row as an "existential threat" to its banking industry, but politicians in the lower house of the country's parliament ignored its recommendation and voted against ratifying the agreement earlier this month. Until yesterday, it still appeared as if the treaty would have to be put to a public referendum, something that would have pushed its approval out beyond the August deadline agreed with the US.
UBS shares rose on news of the parliamentary deal, which the bank welcomed. Around 500 client names have already been disclosed to the US authorities with the clients' agreement, and 1,200 can now follow immediately. "Almost all of the remaining cases – roughly 1,450 – are already being processed, so efforts to comply with the treaty assistance request are on course," the Swiss foreign ministry said.Reuse content