Swiss Bank Indicted in US on Charges of Aiding Tax Evasion

The United States indicted Wegelin, the oldest Swiss private bank, on charges that it enabled wealthy Americans to evade taxes through secret offshore bank accounts, the U.S. Justice Department said on Thursday.

The announcement came six days after Wegelin effectively broke itself up by selling the non-U.S. portion of its business and represents the latest blow to the tradition of Swiss bank secrecy in a long-running U.S. crackdown on tax dodgers.

The Wegelin action signals a ramping up of pressure on 10 other Swiss banks under investigation by the Justice Department, including Credit Suisse, Julius Baer and Basler Kantonalbank.

Wegelin is the only Swiss bank to be indicted in a showdown between the two countries over tax-evasion services sold to Americans. Unlike the United States, Switzerland generally does not consider tax evasion to be a crime.

Switzerland is seeking a solution for its entire banking industry, not just the 11 banks under criminal scrutiny.

On Tuesday, the Swiss finance ministry handed U.S. authorities encrypted data on bank employees who served U.S. clients suspected of dodging taxes, and said it would only provide the key to decipher the data once the row was settled.

In 2009, Swiss financial giant UBS

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[UBS  Loading...      ()   ] paid $780 million to settle U.S. charges that it enabled tax evasion by rich Americans. The bank later turned over the names of more than 4,500 clients.