The U.S. Department of Justice (DOJ) is seeking "total cooperation" from Swiss banks in a draft agreement aimed at allowing the banks to make amends for aiding tax evasion by wealthy Americans, a Swiss newspaper reported on Saturday.
About 100 Swiss banks signed up to work with U.S. authorities at the end of last year in a program brokered by the Swiss government. That followed criminal investigations of roughly a dozen Swiss banks in the United States.
Under the program so-called category two banks - those that have reason to believe they may have committed tax offenses - will escape prosecution if they detail their wrongdoing with U.S. clients and pay fines.
These banks have now received a draft non-prosecution agreement from the United States, which would require them to report in full to U.S. authorities any information or knowledge of activity relating to U.S. tax, the the Neue Zuercher Zeitung (NZZ) said, citing unnamed banking sources.
These requirements would also apply to parent companies, subsidiaries, management, workers and external advisors, the NZZ reported.
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"This total cooperation would, in addition, not only apply with respect to the DOJ and the Internal Revenue Service, but also to anyone, even foreign law enforcement agencies, that the DOJ is supporting in its investigations," the NZZ reported. It said that no end date for this cooperation was given in the draft.
It is also unclear whether the requested information would only need to be handed over when doing so complied with Swiss law, the paper said.
Failure to follow any one of the terms of the agreement would render it void, and the bank could risk prosecution from the DOJ, the NZZ said.