The Wall Street Journal reported today on the way Credit Suisse, a Zurich bank, is dealing with potential new deposits from wealthy clients attempting to evade taxes and "old money" already hidden away . Hans-Ulrich Meister is quoted as saying that
"For the existing undeclared money held here, Switzerland will need a political solution. For new money, if we know it's not being declared, we don't accept it." Bart, Credit Suisse: New Deposits Must Comply with Tax Law, Wall St. J., Mar. 9 2010, at C2.
Mr. Meister also said that Credit Suisse "cannot know" how much of the money held in its bank accounts are being hidden from home tax authorities. And Mr. Meister reported his optimism that the bank will record record inflows this year. Id.
Those statements are not particularly reassuring in terms of whether the new "tax convention" with Switzerland will bring about greater transparency and communication of information about tax cheats. The "political solution" is the need for parliamentary action because of the Swiss court ruling in the UBS case that concluded that account information could not be released because it wasn't tax fraud under Swiss law. But note the apparent evasiveness of the statement about new money. "If we know" is one of those qualifiers that could excuse the same old habits of furthering tax evasion. Qualified intermediary's have an obligation to get a form and find out--if they "pretend" that they don't have US customers using their accounts to hide money, that isn't ok. They are supposed to "know their customers" under the qualified intermediary agreements.
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