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Thinking about opening a Swiss bank account? You might want to reconsider...

Swiss banks dropped their Bank Secrecy
Swiss banks dropped their Bank Secrecy

Switzerland’s second largest bank, Credit Suisse, was at the centre of an international tax evasion case this week, in a criminal investigation led by the Netherlands. Is this the end of so called 'black accounts'? ’There's usually a good reason why people put their money in Swiss bank accounts,’ says Professor Peter Kavelaars from Erasmus School of Economics.

Anti-Fraud Raids

The Dutch anti-fraud agency FIOD made headlines this week as it raided homes and offices across the Netherlands and France, investigating black accounts, offshore accounts, and tax evasion schemes. Prosecutors analysed a huge amount of data, looking for individuals and groups suspected of tax fraud and money laundering.

According to the Guardian, Credit Suisse, Switzerland’s second largest bank, confirmed on Friday that its offices in London, Paris, and Amsterdam had been searched by local authorities concerning 'client tax matters'. The FIOD claims to have information on nearly 4,000 Dutch people who have money at Credit Suisse.

Goods & Assets Seized

The Dutch FIOD seized administrative records as well as the contents of bank accounts, real estate, jewellery, a luxury car, expensive paintings, and a gold bar, from houses in four Dutch towns and cities. The actions angered Switzerland's Office of the Attorney General, which said it was 'disconcerted' by the way Dutch authorities had handled the matter and would demand an explanation. The prosecutors responded that Swiss authorities had been left out of the investigation because none of the suspects were Swiss – they were just linked to secret Swiss bank accounts.

Nowhere to Hide

Dutch news channel NOS asked Peter Kavelaars, Professor of Tax Law at Erasmus University Rotterdam, for his reaction. ‘The net is closing,’ he said, as fewer options remain for hiding savings. ‘There is usually a good reason why people put their money in Swiss bank accounts’. Now that the bank secrecy has been lifted the game of money laundering will change. ‘The tax authorities may recover up to twelve years, so this could involve large sums of money. Millions.’

Over the last few years, billions of euros have been returned due to a voluntary disclosure scheme, higher penalties, and through information exchange. Kavelaars told NOS: ‘Black savers are stuck now. European banks provide information to the Dutch tax authorities annually on the money held in their accounts.’ Now that Switzerland provides information on bank accounts there will be fewer options for black accounts. ‘Even tax havens such as the Bahamas and the Cayman Islands will soon join. So only unstable countries will be tax havens, and you might wonder if that’s where you want to put your money. North Korea, for example.’

Text: Manon Sikkel Daelmans

Reference: Reuters/NOS

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