UBS (UBS) told the IRS and Justice Department to go to hell. The agencies want the names of 52,000 customers who may have evaded taxes in transactions with the big Swiss bank.
According to The New York Times, “the Swiss government said that it would block any move by UBS, Switzerland’s largest bank and a bulwark of the country’s economy, to turn over the names should it be ordered to do so.” UBS is now saying directly that it will not comply with US government requests which will block any effective investigation into the tax issue.
The Swiss and UBS have a point and it is one they are not going to give on. Swiss banks operate under Swiss law even if they do business in other nations. If there is a conflict between the rules set down by the government of the small European country and other countries where UBS does business, the Swiss law trumps all others.
The Swiss regulations, of course, have the purpose of helping the nation’s economy by making its banks a safe haven for depositors who want to keep their identities secret. The system has worked that way for decades, so it should not come as a surprise to American officials that Swiss rules are being enforced.
The Justice Department and IRS have themselves to blame for not going to Congress long ago and asking for legislation to block US citizens from moving their money to Switzerland. Instead, American officials are in the awkward position of asking the Swiss to bend their rules because the US has no rules of its own to restrict the actions of its own citizens who want to move money abroad.
Douglas A. McIntyre
Top Gaining Stocks
Top Losing Stocks