Posted on 01/04/2013 5:57:47 PM PST by nickcarraway
The oldest Swiss bank, Wegelin & Co., is wrapping up an existence that has spanned more than 270 years after pleading guilty in a US case involving Americans who hid funds in secret accounts abroad.
UBS 'ordered' to give out data in US tax probe (10 Feb 12) Swiss banker quits paper amid US tax dispute (09 Feb 12) Oldest Swiss bank sold amid US tax dispute (27 Jan 12)
Wegelin, which was founded in 1741 and based in St. Gallen, eastern Switzerland, unveiled late on Thursday an agreement with US federal prosecutors in New York that includes penalties worth a total of $57.8 million for helping wealthy individuals avoid at least $20 million in taxes.
"Wegelin was aware that this conduct was wrong," said Otto Bruderer, one of the bank's managing partners, as he entered a guilty plea on behalf of the bank to one count of conspiracy.
The bank is the first Swiss financial institution to admit it aided US tax evaders, and has also agreed to preserve data on Americans that had accounts at the bank pending further instructions from competent Swiss authorities.
"Wegelin believed that, as a practical matter, it would not be prosecuted in the United States for this conduct because it had no branches or offices in the United States and because of its understanding that it acted in accordance with, and not in violation of, Swiss law and that such conduct was common in the Swiss banking industry," Bruderer told the court.
The bank carried out operations in the United States via an account with UBS, and the case marked the first time that US justice officials have charged a bank, rather than individuals, as part of a crackdown on overseas tax evasion, Dow Jones Newswires said.
In 2009, UBS, the biggest Swiss bank, reached its own agreement with US authorities that halted legal proceedings against it.
Under terms of that deal, UBS did not acknowledge guilt, but agreed to give US officials the names of around 4,450 US clients who held accounts at the bank.
US Attorney for the Southern District of New York Preet Bharara termed the agreement with Wegelin a "watershed moment in our efforts to hold to account both the individuals and the banks -- wherever they may be in the world -- who are engaging in unlawful conduct that deprives the US treasury of billions of dollars of tax revenue".
According to the Wall Street Journal, the court could sentence the Swiss bank on March 4th formally endorsing the agreement and putting an end to further prosecution of Wegelin in the United States.
Three Wegelin bankers charged in the United States last year are not covered by the agreement, however.
Wegelin had essentially stopped operating as a bank in late January 2012 to focus on the US case, selling its non-US operations to the Notenstein bank, which has since been bought by the Swiss banking group Raiffeisen.
Several Swiss banks are still under investigation by US justice officials, but while the names of Credit Suisse and Julius Baer have circulated for months, none have been formally identified.
In December, the Zurich Cantonal Bank (ZKB) revealed that three of its employees faced charges.
"These are two different cases. In the case of ZKB, three employees (two active and one former employee) have been accused, and there are no indications that the bank will be accused," a bank spokesman told AFP on Friday.
ZKB declined to comment on Wegelin's guilty plea.
So US law is now the law of the World. I thought the Court of Criminal Justice in the Hague was a bit high-handed, but this is even more amazing.
It makes sense to me that US citizens banking in Swiss banks and not paying taxes are breaking US law. So prosecute them. But prosecute Swiss people for breaking US Laws? What if Spain made a law against Death Penalty. Could they put warrents out for US juries or Governors who are instituting it.
I’m not sure why the Swiss capitulated in this case. How did the IRS get leverage on them?
This is why many small countries no longer accecpt bank deposits from Americans. Because while no American is subject to attacks from foreign tax agents, No non-American state is safe from the over reaching IRS.
You may be outside of the US, but you are still US property. Its a land of the free thingie.
What amazes me is the huge amount of untaxed black market money moving around all of us via illegal labor and it attracts no IRS interest. Not low-hanging fruit, I guess.
Whoa!
Ti e to move my funds to Dubai. Been wanting to go to largest indoor snowboard field in the world.
It’s the Catholic Church warring against the Knights Template again. No disrespect to Catholics or the church.
Wasn’t it during the financial crises in 2007 when the Swiss banks started to capitulate on this? Swiss banks, fearing they couldn’t make it if the US came down on them, gave up their historic account privacy. It’s not right that the US has any right to on any foreign account info of a US citizen or bank.
That's a route around this problem.
I would venture it is not because of it being "low hanging", but by design... to wit: the plans for redistribution needs those to whom distributing would be profitable, until such a time as they have the power to do it outright.
I wonder how much this long time bank stole from German Jews back during WW2.
It’s not shocking that Americans would try to preserve some of their assets by hiding them in foreign accounts.
We now live in a country where the top state tax rate of one state (CA) is now the same as the flat tax rate of Russia.
13%
Let’s all get Russian papers and keep our cash there...lol
Singapore is nicer and also wealth-friendly.
If you add up all the taxes the middle class pays it is now over 50%. Don’t forget the fact that ALL corporate taxes are actually taxes that are payed mainly by the middle class. Corporations don’t actually pay tax...they just act as collectors for the IRS and add the tax to everything you purchase.
This country is doomed. The lunatics (socialists) now control the asylum.
So, when do the New York papers publish the names and addresses of the tax evaders involved here?
Partisan Media Shills ping — this meme-building is obviously timed to coincide with the new year’s Obama Tax Hike.
Thanks nickcarraway.
The only person I knew who was Jewish (actually married to a Jewish woman) and physically escaped the Nazis made great use of Swiss banks to move his friends and families assets out of Germany.
Many Jews moved their money to Swiss banks, or had kept it there all along to avoid German financial problems. Eventually many of them were captured and killed by the Germans. So the Swiss had all these accounts with money and no people to collect it.
People die and leave money in banks in the USA all the time. The banks aren’t stealing it. There is a law that says that after so much time of inactivity they get the account (or in some states the State treasury gets the money).
The Swiss were not out to steal money from Jews, in other words, but did end up with millions of presumtively Jewish money after the war.
It was only in the 1980s that lawyers came after them, and in part (it is claimed by some) this was part of a squeeze put on the swiss to decouple their money from gold. The swiss were the last country to do.
There is a book about this called “Gold Wars” I read many years ago.
Are any of Obama’s rich friends going to buy the carcass of the bank?
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