2014 Swiss Bank Disclosure of US Account-Holder Information (Including Now-Closed Accounts Back to 2008) – US Taxpayers Beware

In return for the US Department of Justice’s promise not to prosecute them, well over 100 Swiss banks have agreed to closely review and disclose identifying information on every US person who held an account at their bank at any point from August 1, 2008 to present.

This disclosure of US account-holder information includes closed accounts The inclusion of closed accounts (known colloquially as ‘leaver lists’) represents a startling expansion in the scope and success in the US’ ongoing crackdown on Swiss banks.  Prior US and DOJ enforcement efforts had typically focused on one bank at a time, and had most often allowed the banks to alert their current US account holders and encourage them to flee to smaller institutions.  Those days of Swiss banking whack-a-mole are at an end.

What has this all meant for US clients of Swiss banks?

Typically, this Swiss bank disclosure process manifested itself as a series of mysterious mailings to last-known addresses, with further mailed, emailed and sometimes phone call follow-ups of increasing urgency.  In order to save themselves from penalties equal to 20-50% of the US persons’ accounts, these Swiss banks must show that the US account holder has already entered the IRS’ IRS’ Offshore Voluntary Disclosure Program (OVDP).  The urgency, quite clearly, is related to their desire to prove that their clients have disclosed, thereby savings themselves (for an utterly typical $1 million private wealth account) anywhere from $200,000 to $500,000.

For once, however, the interests of the Swiss banks and their US taxpayers/undisclosed account-holders should be largely aligned.  The reason?  It is also in the best interest of most US taxpayers to enter OVDP.  Waiting rather than taking action, as is becoming increasingly clear, is no solution at all.

According to pre-eminent tax crimes attorney Jack Townsend, the list of banks affected by the Department of Justice’s program (whether as non-participating ‘criminal’ banks, or as participating Categories 2-4 banks subject to varying deadlines) include:

Swiss BankCategory
Aargauische Kantonalbank2
acrevis Bank AG4
AEK Bank 18264
Appenzeller Kantonalbank4
Baloise Bank SoBa3
Bank am Bellevue3
Bank Coop AG2
Bank FreyCriminal
Bank Hapoalim (Switzerland)Criminal
Bank Julius BaerCriminal
Bank Leumi (Switzerland)Criminal
Banque Cantonale de Fribourg2
Banque Cantonale de Genève2
Banque Cantonale du Jura2
Banque cantonale du Valais2
Banque Cantonale Neuchâteloise2
Banque Cantonale Vaudois2
Banque Privee Edmond de Rothschild2
Barclays Bank (Suisse) SA2
Barclays Bank plc Geneva Branch2
Basellandschaftliche Kantonalbank2
Basler Kantonalbank3
Baumann & CieCriminal
Berner Kantonalbank2
BSI Group2
Cembra Money Bank AG2
Cornèr Banca SA2
Credit Suisse AG3
Edmond de Rothschild Group2
EFG International AGCriminal
Glarus Bank2
Goldman Sachs (Swiss Unit)2
Graubündner Kantonalbank2
HSBC Private Bank (Suisse)2
Hyposwiss Privatbank Zurich AG4
Hyposwiss Private Bank Geneve SA2
Liechtensteinische Landesbank (Switzerland) Ltd.2
Linth BankCriminal
Lombard Odier & Cie.2
Luzerner Kantonalbank2
Maerki Baumann AG2
Migros Bank AG2
Mizrahi-Tefahot (Switzerland)Criminal
Morgan Stanley (Swiss Unit)2
Neue Zürcher Bank2
Nidwaldner Kantonalbank2
Notenstein Privatbank Ltd.2
Obwaldner Kantonalbank2
Pictet & Cie2
Piquet Galland & Cie SA2
Post Finance2
Rahn & Bodmer2
RaiffeisenCriminal
Rothschild Bank AG, ZurichCriminal
Saanen Bank2
Schaffhauser Kantonalbank3
Schroder & Co Banque SA4
Schwyzer KantonalbankCriminal
St. Galler Kantonalbank2
Ticino Cantonal Bank2
Trafina Privatbank2
Union Bancaire PriveeCriminal
Valartis Bank (Switzerland)3
Valiant Holding AG2
Vontobel Holding AG2
VP Bank (Switzerland)2
Walliser Kantonalbank2
Zuger Kantonalbank2
Zürcher Kantonalbank2

Those curious to learn the actual rules of this Swiss banking disclosure program won’t go away empty-handed from this post.  Offered here for your edification is the operative program rules in the form of a DOJ-issued document, formally-titled “Program for Non-Prosecution Agreements or Non-Target Letters for Swiss Banks.”  What the reader quickly notes is a remarkably thorough and demanding set of terms in return for amnesty from US prosecution:

Program for Non-Prosecution Agreements or Non-Target Letters for Swiss Banks

After a review of the program terms, a variety of notable details emerge, including:

– The program is is not amnesty for the banks’ US account-holders, but rather is amnesty for the banks themselves.  Indeed, by gaining the cooperation of the Swiss banks, it is now US taxpayers that are in the DOJ’s gunsights.

– 14 Swiss banks (referred to in the chart as the ‘criminal’ banks) are ineligible for the program based on their prior egregious conduct.  All other Swiss banks are given – by this disclosure program – one chance to come clean.   The clear message: the US DOJ will very likely prosecute those banks that do not cooperate and whom they later determine engaged in criminal conduct:

Further Guidance

After allowing a reasonable period of time for head-scratching and follow-up questions from the Swiss banks puzzling about the program’s obviously ad hoc rules, the Department of Justice issued a follow-up round of guidance available here:

Comments on Program for Non-Prosecution Agreements or Non-Target Letters for Swiss Banks

A Clear and Final Warning for US Taxpayers

For US individuals with an undisclosed foreign account, now is the time for action.  Call (415) 745-1924 to speak immediately with experienced Offshore Voluntary Disclosure Program tax attorney Andrew L. Jones. You will receive an immediate, free, thorough, and completely confidential consultation. We are available by phone nationwide or in person at your choice of 6 different offices throughout California. We answer your calls from 9 am-9 pm PST, 7 days a week. After hours, please leave a message or visit our contact form and we will reply the next morning.