‘Constructive’ talks on US banks tax evasion row

Tensions between Swiss banks and the United States justice authorities should ease up in 2015, Finance Minister Eveline Widmer-Schlumpf has said on the sidelines of the joint International Monetary Fund and World Bank spring meetings in Washington.

The minister said she had received positive signals that this year would bring solutions to the conflict, a result of the US Department of Justice (DoJ) crackdown on past tax evasion offences by American account holders at Swiss banks.

Talks with DoJ representatives had been “very constructive”, she noted.

She pointed to the recent example of Lugano-based bank BSI, the first Swiss-based bank to complete the non-prosecution programme hashed out between Bern and the US in 2013. “The bank as well as the American authorities were satisfied with it. We see that the programme is working.”

Widmer-Schlumpf was quick to note that the government is not playing an active role in the conflict, as parliament decided that the banks should resolve their differences themselves. However, Bern is still concerned that Swiss banks are treated fairly compared with others.

Bilateral tax talks with Germany, France and Italy are also going in the right direction, the minister added.

The non-prosecution programme

The deal signed by Switzerland and the US in 2013 sets out a programme for Swiss banks to avoid landing in the US courts on tax evasion offences. Those banks that believe that they may have illegally accepted the assets of US tax cheats had to register by the end of 2013. Some 106 banks chose this route. These banks had to supply the DoJ with documentation showing their business activities in the US. Penalties will range from 20% of the value of assets held in accounts opened before August 1, 2008 to 50% in accounts opened after February 28, 2009.

Banks that have US clients but believe they complied fully with US tax law were able to enter the programme as category 3. The same entry window was open for category 4 banks that are so small they have no US exposure.

The DoJ did not allow 14 Swiss banks, or Swiss-based branches of foreign institutions, to join the programme because they were already under active criminal investigation in August 2013.

swissinfo.ch and agencies