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Switzerland agrees to share private financial data under OECD rules

By Bernard Hibbitts (editor) and University of Pittsburgh School of Law students.

[JURIST] The government of Switzerland said Friday it will follow standards set by the Organisation for Economic Cooperation and Development (OECD), adopting a more stringent definition of tax evasion and agreeing to cooperate with other countries in evasion investigations. Unlike many other countries, Switzerland differentiates between tax fraud and tax evasion, and tax evasion is not a crime. While this policy has not changed, by adopting the definition of tax evasion under Article 26 of the OECD Model Tax Convention Switzerland will henceforward share information "with other countries in individual cases where a specific and justified request has been made." The Swiss government also made clear that by adopting the OECD definition it was not ending to bank secrecy. A statement by the Federal Department of Finance on Saturday said that while the situation for non-resident foreigners has changed, the "decision will have no bearing on legally resident foreigners in Switzerland." Owners of Swiss bank accounts have traditionally enjoyed great privacy, but Swiss banks have recently released information on certain clients. Earlier this month, UBS closed more than 14,000 accounts granted US investigators access to information about bank accounts of terrorism suspects. Prosecutors in the US Attorney's Office for the Eastern District of Virginia requested the information in a four-year old investigation into money laundering to support terrorist activities. Earlier the same year, the Swiss Supreme Court denied a Russian request for the transfer of bank documents to Russia which were relevant to an ongoing investigation into Russian oil giant Yukos.

Full post as published by JURIST - The Paper Chase on March 14, 2009 (boomark / email).