The International Consortium of Investigative Journalists’ Swiss Leaks project, (“the Project”), arises out of whistleblower tips from Mr. Hervé Falciani who worked as a software technician at HSBC in Geneva. During 2008, Mr. Falciani reportedly supplied the French government with the Swiss bank account information of more than 100,000 HSBC customers from over 200 countries. The true beneficial owners of these accounts range from foreign dictators to American actors.
The Project is outlined by the article “HSBC Scandal Heightens Calls for Tougher Bank Oversight.” The article mentions “[t]he use of secret accounts and shell corporations to hide cash and its account holders is hardly confined to HSBC. Another banking giant caught engaging in this was Switzerland’s UBS. And there have been others.” According to reports published today by the Guardian, CNN &/or the BBC, Swiss police raided HSBC offices in Geneva, Switzerland. The police raids could be based on suspected violations of Art. 305bis Swiss Criminal Code: Money Laundering (English Translation) & other anti-money laundering laws.
The police raids and the Project bring to the fore the problem of money laundering through Swiss bank accounts. There are however, some Swiss reforms in this area. The reforms are outlined at an e-mail Swiss counsel sent me last week. The e-mail emphasizes there are “fundamental changes affecting the Swiss financial markets” and says “the business model of the banks is changing towards more transparency on tax matters.” Part of the e-mail is reproduced below and its key points are:
- Automatic Exchange of Information (“AEOI”)—pursuant to an OECD treaty, Switzerland will exchange Swiss bank account information with some nations despite Swiss bank secrecy laws. AEOI will start on or about January 1, 2018 and a video describing how it works is available here.
- Administrative Assistance In Tax Matters—since August 1, 2014 the Swiss have increased their cooperation with foreign governments pursuing tax investigations. This kind of cooperation does not include Swiss disclosure of the identities of specific bank account holders.
- Bearer Shares—effective on or about July 1, 2015 companies owned via bearer shares will be required to keep a central registry of bearer share ownership. As “Bearer Shares & An Asset Search” reveals, bearer shares have been used to maintain money with anonymity in offshore bank accounts.
- New Criminalization of Tax Evasion—tax evasion of over CHF 300,000 during a fiscal period can be prosecuted under the Swiss money laundering statute, Art. 305bis Swiss Criminal Code.
Click On The Image To Read The E-Mail
First Image courtesy of Flickr (Licensed https://creativecommons.org/licenses/by-sa/2.0/) by Twicepix/Martin Abegglen
Copyright 2015 Fred L. Abrams