Firms that sought amnesty include small regional lenders such as Banque Cantonale de Geneve, Swiss private banks like Union Bancaire Privee and units of foreign firms such as Deutsche Bank AG, which said on Oct. 9 it was participating. About a dozen more Swiss banks including Julius Baer Group Ltd. and Pictet & Cie. Group SCA, are already the subject of criminal probes and aren’t eligible to join the program.

Officials at the Frankfurt-based lender, UBP and BCGE declined to comment on their participation in the program.

The Justice Department has threatened to start formal criminal probes of banks with undeclared American assets that don’t participate in the program. An indictment could jeopardize their access to U.S. markets and stop them from making transactions in dollars. That leaves the firms little room to negotiate, said Milan Patel, a lawyer at Anaford AG in Zurich.

‘Lobby Together’

“If the larger banks lobby together over the points they deem unreasonable, the Justice Department may relax some elements of the model agreement,” said Patel, who represents companies and individuals embroiled in the program. “Otherwise, it is either accept it as it is, or withdraw from the program.”

The draft deal was sent Sept. 22, a week after the final deadline for handing over information, according to the letter. The Justice Department is working through documents that detail the amounts managed, business plans for cross-border services and the names of employees and external advisers who helped devise offshore structures to conceal money from the Internal Revenue Service.

The Justice Department is continuing discussions with Swiss banks and is “working through a number of issues in order to implement the requirements of the program,” Nicole Navas, a spokeswoman for the agency in Washington, said in an e-mail.

‘Final Word’

“The final word hasn’t been spoken,” Mark Branson, director of Switzerland’s financial regulator, said at a meeting of the Zurich Banking Association on Oct. 16. “In such a process there are always stages when big demands are made.” While the U.S. program is “expensive” and “onerous,” he said, “the alternative would probably be even worse.”

Banks are wary of dropping out because of the example of Wegelin & Co., the 270-year-old bank forced out of business by a U.S. indictment for helping Americans evade taxes that led to a guilty plea in 2013. The banks need to hold deposits and make transactions in dollars for clients from around the world, as well as to invest their assets in U.S. securities such as Treasuries and in equities traded in New York, and criminal charges would put that at risk.