Lombard Odier & Cie today became the latest Swiss bank to say it would work with U.S. officials in a crackdown on Swiss lenders suspected of helping wealthy Americans evade taxes through hidden offshore accounts.
The Geneva-based bank with 203 billion Swiss francs ($227 billion) in client assets is the biggest privately-held firm so far to say publicly it will take part in a government-brokered scheme to make amends for aiding tax evasion.
The deal between the United States and Switzerland is part of a U.S. drive to lift the veil on bank secrecy in the Alpine country, the world's largest offshore finance center with more than $2 trillion in assets.
Under the deal, Swiss banks have until the end of the year to sign up to the program which requires the firms to hand out some previously hidden information and face penalties of up to 50 percent of assets they managed on behalf of U.S. clients.
A host of smaller listed Swiss banks have come forward, but the majority of Switzerland's private banks are unlisted and often family-run firms like Lombard Odier.
"After a detailed analysis of the program and its implications, the Bank has decided to take the prudent step of signing up to category 2 within the required deadline of 31 December 2013. It reserves the right to join category 3 which opens in the summer of 2014," the bank said in a statement.
Swiss banks putting themselves in the second category have reason to believe they may have committed tax offences, and are eligible for a non-prosecution agreement if they come clean and face fines.
So-called category 3 banks have not engaged in criminal conduct or are deemed "compliant" under U.S. tax rules. They would receive a "non-target letter", or a promise from prosecutors they won't be charged later, and not have to pay fines.