Swiss Banks have very well had a reputation of being secretive about their customer’s transactions and banking activities….But the recent happenings have put forth startling revelations and further prove the point that no body is trust worthy in this world after all.
United Bank of Switzerland’s endeavor to reveal the transactions of US citizens who are its clients and have dealt in tax evading activities along with a $780 million settlement too. Under scrutiny are almost 19000 accounts, while UBS is likely to divulge transaction details of hundred or so customers.
Apparently it has so happened that, the private bankers and bank managers have worked in conjunction with the clients and gone ahead in aiding them to hide almost $20 billion resulting in to evasion of $300 million in taxes from year 2000 onwards. This was done entirely through lawyers and accountants referred to the clients by the UBS bank employees. Similarly, they had advised their clients to make use of Swiss credit cards which could not be tracked by I.R.S. All these steps further led to falsifying facts and faulty tax forms to be filed which ultimately led to tax evasion and benefited the clients immensely.
Adding more fuel to controversy is the recent development in which UBS expresses its disability to go ahead with the reveal the financial details of its clients as it is against the Swiss Law. At stake is now the power struggle between the two governments of the two countries which is likely to not only develop cracks between them. At the same time, the trustworthiness and goodwill of the Swiss Banking system is also at stake.
This is not the first time that Swiss banks have had a hazy cloud over them. Their role in financing the World War II, the money of the Jews businessmen who had their money in the Swiss Banks have not been to retrieve their funds citing loss of documents.
The secrecy factor they have been upholding for so many centuries is in dire need of reviewing as Swiss laws differ from other countries laws regarding matters of tax avoidance, tax evasion and tax fraud further bring in a degree of discrepancy in actualities and legalities. Under Swiss law, tax evasion is not a crime while United States does consider it to be one.
A thorough reviewing of the banking system especially the offshore system is required wherein all the loopholes are cleverly covered which will ensure such happenings do not happen again in the future.
