Swiss banking and beyond

The latest development comes on the heels of a groundbreaking concession. Last week, UBS agreed to demands by the US taxing agency to release the names of about 250 private account holders, who may have used UBS to evade taxes in the US.

But the push and pull between the US and Swiss banking system has broader resonance for the global financial system: Secretive banks and tax havens—free from regulatory scrutiny—are simply unacceptable.

Swiss banks have long been a safe haven for the loot of autocratic strongmen. Reports abound of the most reviled individuals of the 20th century stashing their funds in Swiss accounts, including Zimbabwe’s Robert Mugabe and those close to Saddam Hussein. In 2001, the US accused Swiss banks of clearing Osama bin Laden’s financing.

Offshore centres under pressure to cooperate on tax

ZURICH, Feb 27 (Reuters) - Offshore financial centres which have thrived under a veil of bank secrecy will have to embrace transparency to survive a global crackdown on tax cheats that is menacing the private banking sector in Switzerland and beyond.

A U.S. tax fraud probe into UBS AG, the world's largest wealth manager, is showing Washington is serious about chasing tax dodgers at a time when it is desperate for revenue to revive its ailing financial sector.

In Europe, Britain has joined Germany and France in the battle against tax havens and has put the item on the agenda of a Group of 20 nations meeting on April 2, bringing the political debate on tax evasion to unprecedented levels.

"The pressure is on to crack down on offshore centres," said Dermot Butler, chairman of Custom House, which provides onshore and offshore funds. "The long-term effects on the Caribbean, and Switzerland and Liechtenstein is that those who were suspicious of them will be even more so."

UBS, Stanford Propel Offshore Crackdown

A federal judge has set a July 13 hearing for UBS, in which they may be forced to disclose names associated with 52,000 secret Swiss bank accounts holding more than $14.8 billion in assets. UBS continues to assert that by providing these names, they are compromising overseas privacy laws as well as the reputation of the bank.

”Such violations would expose these employees to substantial prison terms, as well as fines, penalties and other sanctions,” UBS said in a court filing last week. “There is simply no reason to have, nor equity in having, such an expedited process here.”

UBS is feeling the heat from a surge of international pressure to crack down on secret tax havens sought by the wealthy. Estimating the U.S. loses $100 billion a year from offshore tax abuse, President Obama is at the forefront of the campaign to get tough on tax evasion.

Swiss banking and beyond

US regulators and the Swiss banking giant UBS are embroiled in a battle over information on UBS’ private depositors. The US says UBS is facilitating tax fraud, and is demanding information on 52,000 account holders with nearly $15 billion in assets.

The latest development comes on the heels of a groundbreaking concession. Last week, UBS agreed to demands by the US taxing agency to release the names of about 250 private account holders, who may have used UBS to evade taxes in the US.

Swiss banks have long been a safe haven for the loot of autocratic strongmen. Reports abound of the most reviled individuals of the 20th century stashing their funds in Swiss accounts, including Zimbabwe’s Robert Mugabe and those close to Saddam Hussein. In 2001, the US accused Swiss banks of clearing Osama bin Laden’s financing.

UBS tax deal is Swiss bank secrecy's Waterloo

ZURICH (Reuters) - UBS's landmark settlement deal with U.S. tax authorities could be the final nail in the coffin for Switzerland's prized bank secrecy and will have far-reaching consequences for the whole offshore financial industry.

Under pressure from Washington, Berne agreed to let UBS (UBSN.VX)(UBS.N) pass on data of certain U.S. clients without waiting for an ongoing appeal process against the data transfer by some of these clients, an unprecedented step in Switzerland.

Switzerland's leading newspaper, Neue Zuercher Zeitung, called the $780 million (545.70 million pounds) settlement, which UBS agreed with Berne's blessing, a "capitulation".

Secret Offshore Banking - Is It Possible?

Secret offshore bank accounts are the stuff of legend. This article intends to debunk some of the myths about secret offshore banking by setting out what is and isn't possible.

1) It's impossible to open an offshore bank account without first somehow identifying yourself. This means sending a notarized copy of your bank account/passport details to the bank or intermediary.

2) Most offshore banks will also require a reference from a bank at home.

3) If you open an offshore account in the name of your offshore company, you still need to provide all the formation documents, and the name and address of a real person. No bank will let a faceless entity open an account without pinning it down to a real person.

Demand for action on offshore accounts

An online campaign was launched today by Christian Aid urging supporters to lobby their MPs in an attempt to bring tax justice to developing nations.

The charity said creative accounting by large multinational companies was allowing them to evade taxes in countries which had neither the resources nor the expertise to effectively deal with them.

They are asking supporters to pressure their MP to lobby Gordon Brown on the need to an end to off-shore banking secrecy.

Matthew Sowemimo, Christian Aid's tax campaign officer, said: "We are asking supporters to get their MPs involved.

"When an MP writes to the prime minister, he or she has to receive a personal reply.

How offshore capitalism ate our economies

The world, as Arthur Schopenhauer observed, is a business that doesn’t cover its expenses. This wasn’t idle metaphysics but first-hand experience. The Schopenhauer family had been wealthy stockbrokers in the free trade city of Hamburg. Then the European economy collapsed and they lost everything.

Two hundred years later, there is much that Schopenhauer would find familiar in the landscape of bank failures, collapsed companies and growing unemployment. What lies behind the global recession is a particularly virile form of capitalism, now seemingly in its death throes. Let’s call it “offshore” capitalism — literally so in the way it had locked itself into a network of tax havens and offshore finance centers that formed the shadow side of the world’s banks and mega-corporations. But this was offshore in a metaphorical sense too — it produced financial structures and instruments so absurdly technical and abstract that the net effect was a freakishly remote economic system, detached from society.

Offshore Singapore, why so attractive?

Singapore is the 5th wealthiest country in the world in terms of GDP (PPP) per capita. Total GDP (PPP) as of 2007 accounts for $228.303 billion or $49,754 per capita. The state has foreign exchange reserves of more than US$177 billion. Singapore has always been an important strategic and economic center facilitating the world trade and providing its port for US military forces. Within just several years the city-state also became a financial center of Asia that competes with Hong Kong. The impetus that caused Singapore to arise as a banking haven took place in 2004. In the course of its development Singapore had its economy heavily dependent on exports, particularly in electronics and manufacturing. At the beginning of the 21st century the country was hard hit by the slump in the technology sector as well as by the outbreak of Severe Acute Respiratory Syndrome in 2003 as it prevented tourism and consumer spending.