Directorship | Boardroom Intelligence » tax evasion

UBS CEO Says Reputation Needs Fixing

News Editor — Tue, 08 Sep 2009 20:19:16 +0000

An internal memo from UBS Chief Executive Oswald Gruebel to employees said that the rebuilding of the company’s reputation was a crucial goal in the months and years to come, according to Reuters. Gruebel said in the memo today that the recent fight between UBS and Swiss and United States government officials over the privacy of its banking clients’ account information has badly damaged the company’s reputation. “Our results have indeed improved and certain progress has been recognized, but our reputation is still damaged,” said Gruebel. UBS recently agreed to deliver the names of about 4,450 of its American clients to tax authorities as a response to queries of tax evasion.

UBS Informant Receives 40-Month Jail Sentence

News Editor — Fri, 21 Aug 2009 19:14:19 +0000

An ex-UBS banker and informant was sentenced to 40 months in jail today as penalty for enabling tax evasion on the part of U.S. clients of the Swiss bank, according to the Wall Street Journal. Bradley Birkenfeld, who provided key information about his former employer’s illicit activity, pleaded guilty in 2008. Birkenfeld’s prosecutors alleged that the banker allowed an American real estate developer evade $7.2 million in stateside taxes by concealing $200 million in assets. “Today, he is paying the price for that role,” said Eileen Mayer, the chief of criminal investigation at the Internal Revenue Service.

Swiss Banker and Lawyer Indicted in Tax Evasion Case

News Editor — Fri, 21 Aug 2009 10:14:45 +0000

A Swiss banking executive and a Swiss lawyer have been indicted in a Florida federal court for allegedly urging U.S. clients to hide assets at a Swiss private bank in order to evade taxes, the Justice Department has announced. According to The Wall Street Journal, the defendants are said to have urged Americans to move their assets from #UBS to Neue Zuercher Bank, arguing that the assets would be safer at NZB because the bank had no presence in the U.S. and was less likely to face pressure from U.S. authorities to disclose its American clients. Prosecutors alleged that Hansruedi Schumacher, an executive manager at NZB who previously worked for UBS’s cross-border business, and Matthias Rickenbach, a Swiss attorney, helped wealthy American clients conceal their assets by establishing sham offshore entities and by falsifying bank documents. The defendants regularly traveled to the U.S. to confer with clients and lied to U.S. authorities about the reasons for their travel, the indictment alleged. Prosecutors also alleged that the defendants discouraged their U.S. clients from voluntarily revealing their Swiss accounts to U.S. tax authorities. Among the details disclosed in the 14-page indictment, Messrs. Schumacher and Rickenbach allegedly assisted two U.S. clients who pleaded guilty in recent weeks to hiding assets in Swiss accounts.

UBS Tax Settlement Should Help Bank Recover

News Editor — Wed, 19 Aug 2009 10:33:40 +0000

The landmark settlement of the U.S. tax case against Swiss bank UBS — of which details are expected this week — should help the bank restore its image and open the way for the Swiss state to sell its UBS stake. Industry insiders told Reuters that the deal could be announced as soon as Wednesday after the first regular meeting of the Swiss cabinet following the summer recess. The world’s second-largest wealth manager will hand over details of about 5,000 client accounts, sources have said, after the signing of a deal agreed last week to end a dispute in which U.S. tax authorities originally asked for details on 52,000 clients suspected of tax evasion. “The (U.S.) Justice Department summons deal looks favorable for UBS and for Switzerland,” said Vontobel analyst Stefan Schuermann. “However, we remain cautious as long as we do not know the exact figures and details of the deal.” The reputational damage to UBS will take time to repair, and money outflows, which totaled nearly 40 billion Swiss francs ($37.21 billion) in the second quarter alone, will probably continue for a while, said Schuermann. The client accounts to be disclosed will likely belong to people suspected of committing tax fraud under the terms of a double taxation agreement that obliges Switzerland to provide help if Washington seeks it in a criminal investigation. It’s been reported 150 wealthy U.S. clients of UBS were likely to face prosecution by the Internal Revenue Service.

Government to Investigate 150 UBS Clients

News Editor — Tue, 18 Aug 2009 18:28:22 +0000

Now that UBS has agreed to release the names and account information of approximately 5,000 American clients, the United States government is opening criminal investigations on over 150 of these individuals. According to the BBC, the governments of the U.S. and Switzerland had negotiated the release of client information, to be completed tomorrow; this paves the way for criminal investigation on the part of U.S. regulators. UBS has also agreed to pay $780 million to settle the charges that the Swiss bank abetted tax evasion on the part of its American clients.