BERN Aug 26 Switzerland will decide soon on
whether to keep pursuing a tax agreement with the United States,
an outgoing top diplomat said on Monday, or risk extending a
long, costly dispute over banks that shelter tax evaders.
The Swiss government is keen to reach a deal that satisfies
U.S. demands for data to help catch tax cheats and end a
long-running dispute that has seen a handful of Swiss banks come
under U.S. investigation, while dozens more firms could find
themselves in the spotlight for similar transgressions.
But there is a risk the talks could fall through, if
Switzerland refuses to accept what sources told Reuters are
further U.S. demands, after Swiss lawmakers in June voted down a
law that would have eased the transfer of client data for the
That would prolong a scandal that has already cost the Swiss
banking sector billions of francs in withdrawals and raise fears
in Switzerland of further indictments like the one that felled
Wegelin, the country's oldest bank, earlier this year.
"A decision will be made shortly," Michael Ambuehl,
Switzerland's top negotiator on tax matters, said on the
sidelines of his last press conference on Monday.
"Both sides are trying to reach a deal soon."
The 62-year-old Ambuehl, who is leaving the civil service to
become a university lecturer on conflict management at the end
of this month, didn't elaborate except to say Switzerland would
not enforce any emergency law to reach a deal or change its
secrecy laws retroactively.
Ambuehl's departure comes as Switzerland moves away from a
"cherry-picking" strategy of striking individual deals, such as
ones with Great Britain and Austria, in favour of broader ones.
For example, the Swiss government will work with other
nations in developing an international standard for sharing data
on foreign depositors, a move which would lift the last vestige
of its tradition of banking secrecy.
Current talks with U.S. officials centre on roughly a dozen
banks under investigation, including Credit Suisse,
Julius Baer, the Swiss arm of Britain's HSBC,
privately held Pictet and state-backed regional banks Zuercher
Kantonalbank and Basler Kantonalbank.
The Swiss government has said it will grant these banks
permission to hand over data to the United States that will
allow them to avoid charges as they cut individual deals.
While the two governments wrangle over the terms of an
overarching accord, Swiss banks not yet under investigation find
themselves in legal limbo. They are keen to cooperate with U.S.
prosecutors to avoid an indictment, such as that which led to
Wegelin's demise, but they are unsure what information they can
A source at one bank targeted told Reuters last week that
talks between the banks under investigation and the U.S.
Department of Justice are at a standstill because the DoJ cannot
conclude an agreement without a legal framework for the entire
Swiss banking industry.
UBS paid a fine of $780 million in 2009 and
delivered the names of more than 4,000 clients to avoid
indictment, giving the U.S. authorities the information that has
enabled them to pursue other Swiss banks.