Swiss bank privacy may be coming to an end
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Swiss banking has long been synonymous with secrecy and offshore funds. But now international pressure is finally taking its toll on the Swiss banking tradition and forcing the once private banks to become more transparent.
Germany is leading these calls for transparency. Chancellor Angela Merkel's government is reportedly willing to pay €2.5 million to an unconfirmed source for a CD containing details of Germans using Swiss banks to escape paying taxes.
A similar tip-off regarding Swiss bank involvement in tax fraud came from Rudolf Elmer, a former employee of Swiss Bank Julius Baer. Elmer says that he was fired from his Cayman Islands office after complaining about the bank’s illegal activities. He managed to hold on to highly sensitive material following his dismissal and says he eventually passed it onto tax officials in Germany.
Elmer’s information led to raids on one of Germany’s richest families, according to the Financial Times Deutschland.
Elmer says he feared for his life during the ordeal.
Speaking to Euranet’s William Peacock he said, “We were stalked, they put pressure on the family, I was getting close to mad, because the guys followed us, we had a car chase on the highway in Zurich […] and the police didn't act, didn't help us at all.”
Repeated violations
This isn’t the first time the Swiss banking system has come under fire. Greg Rickman chaired a US senate investigation into Swiss banks and the money of Holocaust victims, resulting in a 1.5 billion dollar settlement.
In 1934, the Swiss banking secrecy law was created at least in part to protect Jewish money from the Nazis.
However, after the war when they wanted to withdraw their money from the Swiss accounts Rickman claims “the Swiss bankers would do everything that they could to keep the money away from these people.”
While serving on another US committee, Rickman and his colleagues found that US$100 bills were funnelled through Swiss banks to Iraq, Iran and Cuba, all of which were “embargoed rogue nations”. Under threat of subpoena the Swiss banks delivered the relevant information to the committee.
The results show Swiss banks may soon be forced to conform more to international standards of transparency. But according to Rickman nothing has changed: “These people don't learn. The Swiss banks keep getting involved in the same kinds of problems, because of their own actions.”
