November 16, 2011 / 12:18 PM / 7 years ago

Swiss cabinet in move to inform U.S. bank clients

ZURICH (Reuters) - The Swiss cabinet approved on Wednesday an amendment to a tax agreement with the United States to ensure that bank clients are properly informed about requests from U.S. authorities for data on suspected tax dodgers.

“The amendment should ensure that the procedural rights of affected persons domiciled in the United States remain guaranteed,” the government said in a statement.

The move comes as Switzerland faces mounting pressure to hand over data on U.S. citizens suspected of using secret Swiss bank accounts to dodge taxes.

Credit Suisse CSGN.VX said last week it was complying with a request from the Swiss government for account information after U.S. authorities requested help.

U.S. authorities, which suspect thousands of Americans have used Swiss accounts to evade billions of dollars in taxes, have been conducting a widening criminal investigation into scores of Swiss banks, including Credit Suisse.

The Swiss government has been in talks with U.S. authorities for months to try to secure a deal that would end investigations into 11 banks in return for payment of fines and the names of clients suspected of evading taxes.

However, the extent of its cooperation is limited by strict

bank secrecy laws, which helped Switzerland become the world’s biggest offshore banking center with $2 trillion in assets.

The new amendment to its 1996 double taxation agreement with the United States is designed to ensure that bank clients are correctly informed even if U.S. requests for Swiss help finding tax dodgers do not identify a suspect by name.

“The amendment to the ordinance governs the procedure for nameless requests in cases where the bank is unable to identify the affected persons,” the government said.

A Swiss parliamentary committee last week approved a government proposal to allow the country to hand over data on clients on the basis of patterns of suspicious behavior.

The proposal represents the Swiss government’s attempt to settle the U.S. dispute and avoid a lengthy court fight by Swiss bank clients seeking to protect their identity.

Switzerland struck deals with the U.S. authorities in 2009 to end investigations into UBS UBSN.VX, involving a fine of $780 million and the transfer of data on some 4,450 clients.

Reporting by Emma Thomasson; Editing by Hans-Juergen Peters

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