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Latest update: 02/02/2010
- Angela Merkel - banking - Germany - privacy - Switzerland - tax evasion
Germany and Switzerland on collision course over banking secrecy
Germany announced Monday that it may buy the names of suspected tax-dodgers from a Swiss whistle-blower, leaving the two countries on a collision course over Switzerland’s prized banking secrecy regulations.
By News Wires (text)
AFP - Germany and Switzerland were on collision course on Monday over the Alpine state's cherished banking secrecy after Berlin said it might buy the names of suspected tax-dodgers from a whistle-blower.
Press reports said that an informer had offered Berlin the names of up to 1,500 Germans hiding their riches from the tax authorities in Switzerland for 2.5 million euros (3.5 million dollars).
Switzerland warned Germany that buying stolen information "violates public policy and the principle of good faith ... (and) constitutes a breach of the privacy of the clients concerned," refusing to cooperate if Berlin went ahead.
But with reports saying that the information would give Germany around 100 million euros in recovered taxes, German Chancellor Angela Merkel said "everything must be done to get hold of these data."
"Like every sensible person, I want to clamp down on tax evasion," Merkel told reporters in Berlin. "If these data are relevant we should aim to get hold of them."
The finance ministry said that Germany was considering following a 2008 "precedent" involving Liechtenstein, another Alpine country that has come under fire for its banking secrecy.
In that case, the German secret service handed over five million euros for the names of hundreds of German business executives, sports stars and entertainers allegedly hiding some four billion euros.
In the ensuing investigation, Germany clawed back some 180 million euros.
The scandal claimed the scalp of Deutsche Post chief Klaus Zumwinkel, who got a two-year suspended jail sentence and was fined close to one million euros after admitting hiding cash in the principality.
Germany handed other countries the names of some their nationals and the scandal put tax havens in the international firing line just as the financial crisis sparked new calls for transparency in the banking industry.
Switzerland and Liechtenstein have since moved to clean up their acts, agreeing to share more tax information with other countries. Both have since been removed from an OECD "grey list" of tax havens.
Swiss banking giant UBS last year agreed to hand over details of about 4,450 clients and US taxpayers, although last month a Swiss court upheld an appeal by one taxpayer against the transfer.
There are some voices in Germany, however, that are cautious about paying for the information and with a new government in power after elections late last year, it is not clear that Berlin would cough up again.
"Personally, I have a problem with it if one hands over money for something that has come into someone's possession in a legally questionable fashion," Defence Minister Karl-Theodor zu Guttenberg, a close Merkel ally, told the Swiss daily Neue Zuercher Zeitung.
Doubts emerged meanwhile about the identity of the whistle-blower.
The Financial Times Deutschland daily named him as Herve Falciani, a IT specialist formerly employed by British bank HSBC in Geneva, who passed on data to the French tax authorities.
"This is just a rumour," Falciani, 37, told AFP. "If they have any shred of proof, they should produce it.
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Comments (4)
tax evasion must be controlled
it is an universal problem, if the governments dont strictly control it, it will get worse and worse, bribery and tax evasion exist in every corn of the world, it origines from the human being's greed, which is weakness of the human natures since longtimes, even if in Germany, normally people are used to obey the rules strictly, do the something extremely correct, it can not avoid the greed when people face it..we must give the strict, heavy penalty to those people who violate it...in order to complete block the passage or any possibility to be used by certain people...who make use of the powers, private rights to profit themselves...it must be strictly punished..
Alpine Attack
This whole thing is horrible and illegal. The exaggeration that all who have overseas accounts in the Alps etc. are criminal "evaders" is simply an attack on the rich.An attack on the very people who are wealth contributors to the very countries they are being hunted by. And in the end they will leave. And all the jobs and companies and propertythat provides employment will ony add to the soaring unemployment. A loss that will be more than the penny pinching attempts to "recover" lost money by alleged fraud accounts. Naturally there will always be people who are dishonest in private banking, but there are large measures that are always taken regarding WHERE monies originate at the start of a overseas account etc. Appropriate tax is largely paid. The UK in most dramatic attack have simply changed laws overnight (via the "privy council") to make what was yesterday's allowances on tax to encourage growth in revenue to making people owe "back taxes" and shaming them. They have halted business, made false claims, frozen innocent parties accounts all in the name of a witchunt to disguise the Labour politicians ruination of the country's financial sanity. The figures are miniscule in one direction yet there is no due diligence on the UK to face it's own exaggerated public spending. A cesspool of ill devised social needs on a lazy,sneaky unemployed benefit class who gets billions a year for EVADING any form of employment of which there are no penalties. MADNESS!!
Swiss banking secrecy
Germany, USA, UK etc have NO right to impose their sovereignty on Switzerland, Liechtenstein, Andorra, Luxembourg, etc. I don't care much for the hypocritical Swiss but on this issue I agree; leave them alone. I am sure the countries trying to destroy banking secrecy have better things to do such as checking their own internal corruption.
I have no bank in any banking country (indeed I don't have much money at all) but I sure do not like the attempt by the big bully countries to impose their will on smaller weaker countries. This is the idea behind the EU I think; I weould like to see my small country out of the EU at this point.
Germany's stance on privacy.
Germany is working hard on improving the Privacy protection of it's citizen in this Information Technology age (aka Germany & Google privacy issues) yet, the government is official sanctioning the acquisition of information obtained illegally. Why the double standard ?
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