UBS Settlement Nearing Approval
On June 3, 2010, the upper house of the Swiss Parliament approved a deal between the Swiss bank UBS and the US government that would disclose the names of American clients to the IRS. The lower house of the Swiss Parliament has yet to approve the deal. If the lower house does approve the deal, the names of over 4,000 American clients will be disclosed to the IRS, which will likely lead to either audits or prosecution for tax evasion.
The parliamentary approval is limited to the particular deal made between UBS and the US government. This will surely lead other foreign governments to try to negotiate with various Swiss banks to get client names. However, the chances of a successful agreement are likely much low for a number of reasons. First, getting another parliamentary approval may be more difficult if the political landscape in Switzerland changes. Second, the other countries may not have the leverage that the US government can generate. Third, other Swiss banks will likely not have the financial difficulties that UBS had when the agreement was created. Finally, the client names may not lead to the significant returns that the US government are expecting.
Originally posted on www.piccololaw.ca, used with permission.
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