In a long-overdue move, the U.S. government has finally smashed Swiss bank secrecy laws by prevailing upon the Union Bank of Switzerland (UBS) to give up the names of hundreds of Americans who have used those laws to evade billions of dollars in taxes.
In fact, given President Obama’s declared intent to go after tax cheats (and the banks that harbor them) the way President Bush went after terrorists (and the countries that harbored them), this is only the opening salvo in what is expected to be a sustained assault on tax havens from Europe to the Caribbean. And, suing UBS or any other bank to keep these names secret will be to no avail.
Frankly, I’ve always been stupefied by the fact that Switzerland has been able to thrive in the international community by laundering cash from narco-traffickers, kleptomaniacs and tax cheats while countries like Columbia (during the 1980s) and Guinea-Bissau (today) have been condemned as narco states.
But it’s a measure of the pressure the U.S. government is now exerting on Switzerland that UBS is giving up names despite it being a violation of Swiss law to do so. (Remarkably, tax evasion is as legal in Switzerland as prostitution is in the Netherlands.)
Therefore, if you’re one of the hundreds of thousands of Americans who have used offshore accounts to evade taxes, you might want to plea bargain with the U.S. Department of Justice before the Swiss and other tax havens are obliged to name you as a fugitive – with all of the financial and criminal implications that entails.
To get a sense of what this development portends, it would be helpful to know that:
UBS is the world’s largest private bank and Switzerland is the world’s largest offshore tax haven, with trillions of dollars in assets.
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