FACTBOX: Status of bank secrecy protection in Europe

Thu Nov 13, 2008 10:33am EST
 
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(Reuters) - Barack Obama's election as U.S. president will open up a new front in a growing campaign against Swiss banking secrecy, already under fire from Germany which wants the country put on a tax haven blacklist, officials said.

The list includes Monaco, Andorra and Liechtenstein.

French President Nicolas Sarkozy has also called for tax havens to be banned.

Here are details on some European countries with strict laws protecting bank privacy:

* LIECHTENSTEIN:

-- Liechtenstein allows foreigners to open trusts anonymously by registering them through a local attorney or trustee. The government says this is in line with international law. German officials say these trusts can be used to evade tax.

-- Until recently, the Alpine principality's banking laws permitted banks to issue numbered accounts, but new regulations require them to know who all account holders are.

-- Liechtenstein reacted with fury last February when Germany launched a probe into thousands of its citizens suspected of parking savings in the country's banks to evade tax.

* LUXEMBOURG:

-- Luxembourg's banking secrecy law says that those who work in financial institutions cannot reveal information to the outside world except in money-laundering cases.

-- Under the 2005 EU Savings Directive, Luxembourg allows some account holders to keep their identities secret from their countries of residence by paying withholding tax instead.

* SWITZERLAND:

-- Switzerland's protection of banking secrecy goes back to 1934 when it passed a law imposing heavy penalties, even prison sentences, for breach of banking secrecy.

-- The Swiss waive secrecy in criminal investigations. Banks supply information requested by foreign governments pursuing criminal investigations of individuals, but this does not automatically extend to tax matters.

-- Switzerland allows EU account holders to keep bank secrecy by paying withholding tax instead. But Switzerland has signed bilateral agreements with dozens of states over the past decade under which it will give them access to Swiss bank accounts in specific instances where it has found clear evidence of tax fraud.

-- Obama has singled out Switzerland's UBS as one of the banks who helped American "tax cheats."  Continued...

 

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