Wills, Trusts & Estates Prof Blog

Editor: Gerry W. Beyer
Texas Tech Univ. School of Law

Wednesday, April 14, 2010

Swiss Bank Secrets

UbsI have posted several blogs on the U.S. investigation of UBS, including here, here, and here. Below is the "background" story that led to these investigations and their resulting effect.

UBS, Switzerland’s largest bank, was facing collapse in 2008. When the Swiss government rescued UBS in October 2008, investors across the world felt relief. They had no idea that UBS was about to face an unrelated yet potentially devastating crisis.

U.S. officials summoned top executives from UBS and Swiss regulators to New York for a discussion regarding a tax fraud investigation. UBS planned to admit guilt and settle the case, but the U.S. Department of Jutice Tax Division Attorney, Kevin Downing, threw them a curveball. As a condition for settlement, Downing requested that UBS turn over the names of U.S. tax evaders.

This gave UBS two unfavorable options: breach Swiss bank secrecy or risk indictment in the United States. UBS eventually settled for $780 million and some client names. This setback, combined with that of the credit crisis, has pushed UBS closer to the edge than most realize. UBS’s new management team will now attempt to stabilize its wealth management division, whose advisors and clients have been dispersing.

For more information, including details regarding the “Swiss Secrets,” see Lisa Jucca, Special Report: How the U.S. Cracked Open Secret Vaults at UBS, Reuters, April 9, 2010.

https://lawprofessors.typepad.com/trusts_estates_prof/2010/04/swiss-bank-secrets.html

Current Events, Estate Planning - Generally | Permalink

TrackBack URL for this entry:

https://www.typepad.com/services/trackback/6a00d8341bfae553ef01347fdbe437970c

Listed below are links to weblogs that reference Swiss Bank Secrets:

Comments

Post a comment