Swiss to Share Details On Russian Accounts

BloombergUBS agreed in August to reveal some of its clients’ details to the U.S.

Switzerland will soon allow Russia to obtain information regarding the Swiss bank accounts of Russian citizens, a deal that could help authorities in their pursuit of tax evaders.

Swiss President Hans-Rudolf Merz said his country has reached a compromise with the United States on a similar issue and by the end of the year will sign agreements with 12 other countries on the exchange of information.

In May, a Russian Finance Ministry official said Switzerland was one of the countries with which the ministry — with the support of the Foreign Ministry — was negotiating new protocols for receiving tax information. Russia wants Switzerland to provide information about firms’ final beneficiaries without the need for court approval, even if the information is a bank secret or the personal knowledge of a bank agent or trustee.

A representative of the Swiss delegation said an agreement with Russia would be signed in November.  

Switzerland will do everything in its power to be excluded from the Organization for Economic Cooperation and Development’s list of countries where illegal profits can be concealed, Merz said.

Switzerland was included in the list at the beginning of the year as U.S. President Barack Obama declared war on tax havens around the world. At the G20 summit in April, world leaders lent their support to the idea that the era of bank secrecy was over.

Last month, UBS — with the permission of the Swiss government — agreed to reveal the names of 4,450 clients out of 52,000 whose information the United States had requested. Switzerland has also signed a deal with France, and French Budget Minister Eric Bert has said his country received information on 3,000 individuals who might be concealing a total of 3 billion euros ($4.43 billion).

Wealthy Americans have managed to stash as much as $20 billion in Swiss bank accounts, U.S. prosecutors said last month. The amount of assets kept in Swiss bank accounts by Russians is not known.

“If Switzerland agrees to release banking information to Russia, this would be a big surprise. Many people still keep money there in direct accounts,” said Alexander Zakharov, a partner at the Business Legal Support Center.

There’s nothing criminal in transferring funds to a Swiss bank account, said Sergei Belyakov, a senior official with the Economic Development Ministry.

But access to that information will allow Russia to monitor the source of these funds and determine whether taxes have been paid on them, he said.