One-third of Swiss banks offered amnesty by the U.S. for helping Americans evade taxes have applied for the program, a federal prosecutor stated at a Jan. 25 conference, according to three lawyers.
The U.S. government gave more than 300 Swiss banks until Dec. 31 to seek non-prosecution agreements if they have “reason to believe” they violated tax laws. Some 106 sought to join the initiative, which requires participants to disclose how they helped Americans hide assets, hand over data on undeclared accounts and pay penalties.
The program is the largest assault in a five-year U.S. Department of Justice crackdown on offshore tax evasion. Kathryn Keneally, an assistant attorney general in the its tax division, cautioned at the American Bar Association conference in Phoenix that the final figure may change, the lawyers said. She didn’t name any banks seeking to take part in the U.S. effort, which isn’t open to 14 institutions already under criminal scrutiny, including Credit Suisse Group AG and HSBC Holdings Plc.
Bryan Skarlatos, of Kostelanetz & Fink LLP in New York, who attended the conference, said the number of banks that signed letters of intent was more than expected.
“It’s a result of the banks’ desire to have some certainty regarding their status with DOJ,” Skarlatos said. “I believe that DOJ is pleased with the response to the program so far.”
Keneally declined to comment on the amnesty program.
$2.2 Trillion
“She said that every new bank in the program is a new source of information, especially on where the money went, either to other Swiss banks or banks around the world,” said Josh Ungerman of Meadows Collier Reed Cousins Crouch & Ungerman LLP in Dallas. “She said there are a lot of avenues to get information, and some are visible and some are not so visible.”
Banks in Switzerland, the largest cross-border financial center with $2.2 trillion of assets, closely examined accounts before seeking to join the disclosure program.
“The takeaway is the U.S. has been successful in getting Swiss banks to really start cooperating and enter into non- prosecution agreements,” said Martin Press, a tax attorney in Fort Lauderdale, Florida, who heard Keneally speak.