Swiss bank admits helping US tax evaders

Normal 0 false false false EN-US X-NONE X-NONE MicrosoftInternetExplorer4 /* Style Definitions */ table.MsoNormalTable {mso-style-name:"Table Normal"; mso-tstyle-rowband-size:0; mso-tstyle-colband-size:0; mso-style-noshow:yes; mso-style-priority:99; mso-style-qformat:yes; mso-style-parent:""; mso-padding-alt:0in 5.4pt 0in 5.4pt; mso-para-margin:0in; mso-para-margin-bottom:.0001pt; mso-pagination:widow-orphan; font-size:11.0pt; font-family:"Calibri","sans-serif"; mso-ascii-font-family:Calibri; mso-ascii-theme-font:minor-latin; mso-fareast-font-family:"Times New Roman"; mso-fareast-theme-font:minor-fareast; mso-hansi-font-family:Calibri; mso-hansi-theme-font:minor-latin; mso-bidi-font-family:"Times New Roman"; mso-bidi-theme-font:minor-bidi;} In a major break from Switzerland's traditional banking secrecy, its largest bank, UBS AG, will turn over the identities and account information of about 250 account holders as part of a $780 million settlement with American prosecutors.   UBS was accused of conspiring to defraud the US government of taxes owed by thousands of wealthy American clients by creating sham accounts to hide clients' assets.   "We accept full responsibility for these improper activities," Peter Kurer, chairman of the Swiss banking giant, said in a statement. He added that the bank was determined to abide by the terms of the deal with US criminal and securities officials.   In light of the bank's acknowledging responsibility, the Justice Department recommended dismissing the charge. The deal was struck in a federal court in Fort Lauderdale, Florida.   Approximately 17,000 American clients concealed their UBS accounts from the Internal Revenue Service, hiding assets of roughly $20 billion in total, officials said.   Prosecutors suspect that from late 2002 to 2007, UBS helped American clients evade $300 million a year in taxes. UBS earned approximately $200 million annually from the business.   Prosecutors contend that UBS executives used encrypted software and other countersurveillance techniques to prevent detection that they were actively marketing their secrecy to American taxpayers. The clients, in turn, filed false tax returns that omitted the income they earned in their Swiss accounts, according to the court papers.   If UBS fails to turn over the clients' information, or stops cooperating with authorities, federal prosecutors could refile charges against the bank and its executives, under the terms of a so-called deferred prosecution agreement.   UBS also agreed to end its business practice of providing banking services to US customers with undeclared accounts.   The settlement of $780 million in fines, penalties, interest and restitution caps a difficult time for UBS, which lost more than $50 billion in the collapse of the US mortgage market and received a $60 billion bailout from the Swiss government last October.