UBS or Just Plain BS?

The Obama Justice Department has just floated a trial balloon to see if it can drop a legal effort to force the Swiss Bank UBS to disclose the names of 52,000 rich Americans suspected of using the bank to evade US taxes. Back in February, the Justice Department sued the bank in an effort to force it to name names. Now, however, a straight, rather unquestioning article in the New York Times' business section -- likely not to get the attention it deserves -- reveals that the whole matter may just disappear.

The apparent change of plans is offered to the Times by "a United States official briefed on the matter...The move, which would halt an unusually aggressive effort to force Switzerland to lift its veil of banking secrecy, could happen by mid-July."

And the reason for this? An aggressive lobbying campaign. The Swiss bank's central claim is that if it discloses client names it would "violate Swiss financial secrecy laws and open its executives and bankers to prosecution in Switzerland."

That seems highly improbable -- more an excuse than a true justification for halting the effort to track wealthy Americans who shirk their responsibility to their fellow citizens. If the US successfully compels these Swiss bank officials to provide information about illegal behavior by US citizens, it is certainly a stretch to imagine those bankers being jailed in their own country for being so compelled.

Crucial context is missing here. One way to understand the stakes is to study the deeper nature of UBS's relationship with the United States, including a long history of involvement in murky international ventures with all the hallmarks of covert offshore intelligence operations. For more on that, I refer you to material contained in my book, Family of Secrets: the Bush Dynasty, the Powerful Forces that Put It in the White House, and What Their Influence Means for America.

Comments

[bowater]

when you are in a country and break their law you can be punished. Should you punish the country that the perpitrader came from?
UBS should pay a hefty fine. it is not a criminal offence. they didn't kill, rape, or take someones freedom away. When Companies break the law, they get fined and executives are fired.
When Dupont( US chemical company) was negligent and a chemical spill killed hundreds of people in India, the company paid a hefty fine, executives were fired and cleanup ensued. The Indian government didn't attempt to interfere with the US chemical safety laws.
Obama will not be remembered for collecting a few million dollars from US tax payers with Swiss accounts. He will be remembered for not standing up to Iran, when they needed a western voice. (the signs from the crowds were in English) and letting North Korea push us around.
After all, a tax hungry U.S. administration that will double-cross a faithful ally such as the Swiss; the same administration that shamelessly perpetrates a global smear campaign and threatens unprecedented economic sanctions – all to force a change in Swiss privacy laws and get more taxes…such an administration simply cannot be trusted.

[TJCole]

UBS and Phil Gramm helped start this entire fiasco and they, among so many others are above the law..!

[sibaer]

Swiss laws are Swiss laws. The United States must accept that countries other than the U.S. have different jurisdictions. As long as they are built on democracy and capitalism, such as the Swiss', there is nothing wrong with honoring them. Not in a single case has Switzerland refused to help prosecute tax evaders - what bothers the U.S. is that they do not just give out information based on vague suspicion.

May I reflect on the history of the Swiss banking secrecy? Picture Nazi-Germany during WW II - do you think the Jews liked Switzerland's stability and banking secrecy? It may well have saved some of their lives.

[heal57]

I'm with you. Swiss law does not give out info on their customers. The Swiss are not owned by the USA.

[StoicRep]

Yes, but diplomats get away with murder. This is not an internal consideration. This is an international situation. Here in the US our revenues are down 30%, partly because of income tax evasion. Even Geithner did it and thought money earned abroad is nontaxable. It is taxable and using the Swiss bank is the manner in which they evade paying their legitimate taxes. Everyone else pays their fair share of tax. Why should people let these eels slither away from paying theirs?

It is entirely appropriate for our government to seek out violators of our tax law, just as we would want a foreign government to help out with the apprehension of a terrorist.. IF the Swiss feel it is in their long term interest to comply, then they will. They probably ought to comply.

[sibaer]

So what you are saying is that we should blame the Swiss for the decrease in revenues which stems from Bush's tax cuts for the rich?

Keep in mind also that all revenues earned on capital (interest and dividends) are subject to a 35% withholding tax in Switzerland.

On this note I might mention that some Americans choose to trust Swiss bankers more than U.S. bankers. Think of the dollar's losing its value and the tremendous inflation we're facing. Banking in Switzerland is not all about hiding money.

After all who committed the crime were Americans. Or did the Swiss banks tell American tax evaders that they must not declare their assets with the IRS? If you want to hide money, you're better off in the Cayman Islands - nobody is really talking about them.