Swiss banking secrecy will not go quietly into the night.
Earlier today, the lower house of the Swiss Parliament rejected a deal with the United States to turn over bank data from thousands of American customers of UBS suspected of being tax cheats.
The deal was approved last week by the upper house of Switzerland’s Parliament. The two houses have until the parliamentary session ends on June 18 to reconcile the differences.
The Swiss government agreed last summer to disclose the data of 4,450 customers, ending a lawsuit brought by federal prosecutors who accused the Swiss bank of aiding US tax cheats. But a Swiss court said the deal violated national laws requiring banking secrecy. The parliamentary votes were required to amend the laws and permit the deal.
Under pressure from the G20 to relax its long-running banking secrecy rules, the Swiss have cut deals to share information with a number of foreign governments, including the UK, France and Denmark. It’s not immediately clear whether those deals are also imperiled.
The US deal is not necessarily dead. Under the terms of the deal with the US, the Swiss have until August to turn over the names. The lower house’s two largest parties—right of center People’s Party and the left of center Social Democrats—have said they will support the deal so long as parliament approves other financial reform measures. The People’s Party wants a commitment that taxes on banker’s bonuses won’t be raised. The Social Democrats want to regulate risk-taking at the country’s "Too Big To Fail" banks.
If the lower house doesn’t approve the deal, the US may revive the lawsuit against UBS. The US had initially sought data on 54,000 UBS customers.
