Swiss IRS Target
The Sovereign Society
by Bob Bauman: Doctor
No Comes Into His Own
For sound asset
protection and ease of investment you need an offshore bank account.
I pointed out last week, Americans must be very careful about
which bank they choose and what advice they accept.
For those interested
in offshore financial activity there is no need to re-run the sad
details of the UBS tax evasion scandal that ended decades of absolute
statutory Swiss bank secrecy and tarnished that countrys
good reputation in the process.
But as I
told you some months ago, UBS is not the only target of the
U.S. Internal Revenue Service. I explained then that the second
largest Swiss bank, Credit Suisse, was also in the IRS cross hairs,
along with Swiss cantonal banks.
when the IRS cracked down on the two largest Swiss banks, UBS and
Credit Suisse, both have suffered huge cash outflows. UBS paid a
$780 million fine in 2009 and agreed to turn over 4,450 names of
American clients. Much of the U.S. and European client money was
assumed to have gone to banks in the Far East but tens of billions
of dollars may have ended up in Swiss cantonal banks.
Today the New
York Times reports
that a senior private banker at Credit Suisse has been arrested
in the United States in connection with a federal investigation
into the Swiss banks work with questionable offshore accounts.
Christos Bagios, a Greek citizen, was arrested in New York and transferred
to Fort Lauderdale, Fla., where he has been charged with conspiracy
and fraud. Bagiso heads an SEC registered private banking unit that
is part of Credit Suisse Private Advisors based in Zurich.
An arrest such
as this is a highly unusual move and seen as proof that the U.S.
Justice Department is zeroing in on Credit Suisse and the possibility
that the bank may have helped wealthy American clients to evade
It was not
clear whether Mr. Bagios was cooperating with the DOJ investigation,
a move that would increase pressure on the bank.
In 2008, a
former top UBS executive, Martin Liechti, was arrested and detained
in Miami in connection with the major federal investigation of UBS.
Mr. Liechti, a Swiss citizen who was UBSs top private banker
for the Americas, was allowed to return to Switzerland after several
months and cooperated with the IRS in its investigation of the UBS
tax evasion scandal.
In a possible
repeat of the UBS mess, the U.S. Department of Justice probably
will demand names of Credit Suisse American clients under the terms
Swiss-U.S. tax treaty.
chapter in the U.S.-Swiss tax evasion story comes just days after
the Swiss government
announced plans to relax still further the conditions for the
release to the U.S. and other governments of tax and other information
on foreign bank account holders.
I repeat: the
Swiss government has come a long way in a short time; from defending
absolute financial privacy under the 1934
Bank Secrecy Act, (still the law a year ago) to who knows what
Credit Swiss accounts are about to discover the answer to that question.
Rumors have it that the Swiss division of HSBC is also high on the
current IRS hit list.
with permission from the Sovereign
February 24, 2011
E. Bauman is a former Member of the United States House of Representatives
from Maryland, (19731981). He is also a former federal official
and state legislator; Member, Washington, DC Bar; Graduate of the
Georgetown University Law Center (1964) and the School of Foreign
Service (1959), Washington, DC. Robert currently serves as legal
counsel for the Sovereign
© 2011 Sovereign Society