Voluntary Disclosure News: IRS Offers a Deal to 11 Swiss Banks

According to Reuters and Sonntags Zeitung, U.S. officials are offering eleven Swiss banks (including Credit Suisse, Julius Baer, Basler Kantonalbank and HSBC Switzerland) a deal that allows them to avoid criminal prosecution in exchange for revealing details of their U.S. offshore business to the U.S. government.

Allegedly, in exchange to dropping the criminal prosecution, the banks would have to pay a hefty fine and agree to assist IRS in tax evasion cases. This means that the Swiss banks will have to deliver all information on their U.S. offshore business (via Bern) to the United States.

Allegedly, as part of an agreement, the banks would hand over to the IRS: the correspondence between a bank and its U.S. clients (including notes from telephone conversations and meetings), internal notes about U.S. client business from all relevant business units, correspondence between the banks and third parties (such as wealth managers) concerning U.S. persons, U.S. funds that were transferred to third parties, and documents about the U.S. business model. The banks would also have to supply the names of the bankers who conducted offshore business, though criminal cases against individuals would not be pursued.

An interesting point in this agreement is that, purportedly, the IRS agreed that the names of the U.S. clients would be blacked out.

While the Swiss banks used to have an iron-clad reputation for protecting their account holders’ identities, it is no longer the case. Since the UBS deal in 2009 (when the Swiss parliament approved a deal forcing USB to reveal details of about 4,450 U.S. citizens), the IRS set an important precedent. Whatever the outcome of the negotiations, it is likely that further damage will be done to the Swiss bank secrecy laws.

Finally, it is important to point out that the information about this deal is still murky and simply based on a source of a Swiss newspaper. The exact details (if the deal is actually agreed to) will likely come out early next year.

Contact Sherayzen Law Office for Voluntary Disclosure of Swiss Bank and Financial Accounts

It is very important for U.S. taxpayers to engage in voluntary disclosure of their unreported foreign bank and financial accounts in order to reduce their civil and criminal penalties. The combination of the deal with Swiss banks and the new Form 8938 makes it extremely dangerous for U.S. persons to continue to delay the disclosure of their foreign assets (where required to do so by law).

If you have foreign bank and financial accounts, whether in Switzerland or elsewhere outside of the United States, contact Sherayzen Law Office NOW to explore your voluntary disclosure options. Our experienced voluntary disclosure firm will help you choose the right disclosure for you, draft and prepare all of the necessary documentation, guide you through the complex regulations of voluntary disclosure, and provide zealous ethical advocacy of your interests while negotiating with the IRS.