Wegelin Closure Spreads Fear Admid Offshore Banking and Advisors

LawFuel.com – The closure of one of Switzerland’s oldest banks, Wegelin which founded in 1741 has left the Swiss banking community in shock with a worrying concern for them about what and who might be next on the Ú prosecution shopping list òf Swiss banks.

Wegelin has also agreed to pay $57.8m (£36m; 44m euros) in fines to US authorities after admitting it helped over 100 Americans hide over $1 billion in money owed to the ÚS Internal Revenue Service . It said that once this was completed, it “will cease to operate as a bank”.

LawFuel for Banking and Tãx Law News – The Wegelin prosecution í the first time a corporation há actually gone out òf business á a result òf an American prosecution ò thí type and it í spreading fear amid the banking community not only in Switzerland but in other offshore jurisdictions ás well.

Ás Forbes magazine reported in 2009 the Justice Department said UBS provided Swiss bank accounts to 20,000 U.S. taxpayers with assets of about $20 billion, and that 17,000 of them hid their identities and the existence of those accounts from the IRS. In the case against Wegelin U.S. authorities say the bank hid about $1.2 billion in secret Swiss bank accounts for U.S. clients.

That’s quite a difference in concealed assets yet Wegelin was criminally indicted and closed shop while UBS entered a deferred prosecution agreement that allowed the charges against it to be dismissed.

The question ís whether the larger banks will heed the Wegelin lesson ỏr whether the real exposure í just for the smaller players in the banking and and planning market.

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