The US Department of Justice (DoJ) has signed an addendum to a January 2016 non-prosecution agreement with Union Bancaire Privee (UBP) for failing to disclose 97 US-related accounts as part of its Swiss Bank Program.
At the time of the original agreement, UBP said it held and managed 2,919 US-related accounts with assets under management of approximately $4.9bn (£3.7bn, €4.4bn) and paid a penalty of just over $187m.
With the addendum, however, UBP “acknowledges” it should have disclosed the other 97 accounts to the DoJ in 2016.
The Swiss private bank will pay an additional sum of $14m and will provide information regarding all of its US-related accounts.
Continued commitment
“Foreign banks that participated in the Swiss Bank Program were obligated to identify all accounts in which US taxpayers held an interest, directly or indirectly,” said Richard Zuckerman, principal deputy assistant attorney general for the tax division of the DoJ.
“The agreement reflects our continued commitment to ensuring that when entities cooperate and make disclosures to the department, that they do so fully.”
Resolve potential criminal liabilities
The Swiss Bank Program, which was announced in August 2013, gave institutions the chance to “resolve potential criminal liabilities in the US relating to offshore banking services provided to US taxpayers”.
Banks that entered the programme were required to advise the DoJ they had reason to believe that they had committed tax-related criminal offences in connection with undeclared US-related accounts.
As participants in the programme, they were required to:
- Disclose of their cross-border activities;
- Provide detailed information on an account-by-account basis for accounts in which US taxpayers had a direct or indirect interest;
- Cooperate in treaty requests for account information; and
- Provide detailed information about the transfer of funds into and out of US-related accounts, including undeclared accounts.
Total penalties
Every bank that signed a non-prosecution agreement in the Swiss Bank Program committed to disclose all known US-related accounts that were open between 1 August 2008 and 31 December 2014.
The DoJ signed non-prosecution agreements with 80 banks between March 2015 and January 2016.
It has imposed a total of more than $1.36bn in Swiss Bank Program penalties.
The programme is separate to the Foreign Account Tax Compliance Act (Fatca), which was introduced in 2010 but only ratified by the Swiss authorities in 2014.
The country’s notorious banking secrecy laws have long troubled tax authorities around the world, as they have been a key stumbling block in their attempts to crack down on tax avoidance and evasion.
