DEAR BUBBAS AND BUBBETTES, Read this and weep yet again. Alas, alas, as is so predictable, the U.S. Government once again seems to have done absolutely nothing at all to try to protect the interests of individual U.S. citizens living in Switzerland who will undoubtedly bear some of the heaviest brunt of this latest hegemonic domination episode. But, hey, when has the U.S. Government ever really cared about Americans living overseas, other than, perhaps, when candidates want us to dip into our pockets to make contributions to their campaign chests? What an embarrassing tragedy this is and how sad that there seems to be no end in sight. But wait, there is some very good news here too!!! Internal Revenue Service commissioner Doug Shulman and Treasury Secretary Timothy Geithner, who discussed the case with Widmer-Schlumpf in April, are both scheduled to depart after the election. Secretary of State Hillary Clinton, credited by Swiss officials with helping negotiations over a settlement for UBS in 2009, is also leaving her job. Hooray, hooray, hooray!!! There won’t be many overseas American tears as these jokers leave the scene. Enjoy and take care, Andy | APOLOGETIC SWISS BANKS SWEAT IT OUT AS U.S., EUROPE MULL REDRESS By Katharina Bart, Reuters, 12 August 2012. ZURICH (Reuters) - Swiss banks hoping to atone for decades of complicity in tax evasion may be left to sweat it out for months as the United States and Germany ponder the right level of punishment. Switzerland has long dodged U.S. accusations of hiding money for wealthy Americans. But now eleven Swiss banks are under investigation in the United States and there is pressure too from Europe where burdened taxpayers want scalps after numerous banking scandals. The Swiss need a deal to remove the taint from their financial industry. However, Washington must factor forthcoming elections into its thinking, and Germany is delaying ratification of a tax deal key to Switzerland's efforts to strike similar agreements elsewhere in Europe. So the Swiss may be in limbo for a while. The wait is painful for a country which counts on banking for 7 percent of its economic output: until Swiss banks know how much information they need to share with foreign tax authorities they will struggle to attract new clients. As a result the share prices of its top banks -- Credit Suisse and Julius Baer are among those being investigated -- are falling as investors fret about earnings. "We are prepared to sign a settlement with the U.S. for the Swiss banks today. We feel we have made a constructive proposal to the U.S. but it is up to them to accept it or not," said Switzerland's Finance Minister Eveline Widmer-Schlumpf. "This depends on whether the U.S. is willing to reach a settlement before or after their elections, which is unclear at the moment," she said. Both Widmer-Schlumpf and chief negotiator Michael Ambuehl have dampened expectations for a U.S. deal by November, stoked as recently as last month by the finance minister herself. "There is an open window after the summer lull, but it's relatively tight. Otherwise, I think we're looking at next year," said Martin Naville, chief executive of the Swiss-American Chamber of Commerce in Zurich. "MICE BEFORE A SNAKE" Switzerland's efforts to spur along a deal include tentatively agreeing with the U.S. Foreign Account Tax Compliance Act, an anti-tax evasion law known as FATCA. The rules on enforcing FATCA have yet to be finalized, but many Swiss bankers see it as a crippling blow that effectively prevents their clients from investing in U.S. securities. Acquiescing to FATCA was a tactic to build goodwill for a Swiss bank deal, a source close to the talks said. But the strategy doesn't seem to be paying off. Washington is now pushing banks in Switzerland to divulge names and financial details of wealthy Americans hiding money in their accounts, spurred on by success in 2009 when UBS handed over data to avert a criminal indictment. "Contrary to what may appear as inactivity, the U.S. is in fact keeping the pressure on Swiss banks, which are like mice before a snake," said Martin Janssen, professor of finance at the University of Zurich. "The U.S. is really maximizing its position here." The tension is such that Swiss bankers are afraid they will be personally targeted by U.S. officials if they leave the country, after Credit Suisse and Julius Baer handed over employee names to U.S. authorities. Originally a gesture towards cooperation, the move now has many Swiss bankers hunkered down at home, fearful of arrest and extradition if they leave Switzerland. WASHINGTON RESHUFFLE Adding to the agony, several key U.S. officials plan to step down, which could mean negotiations having to be reset. Internal Revenue Service commissioner Doug Shulman and Treasury Secretary Timothy Geithner, who discussed the case with Widmer-Schlumpf in April, are both scheduled to depart after the election. Secretary of State Hillary Clinton, credited by Swiss officials with helping negotiations over a settlement for UBS in 2009, is also leaving her job. Another key U.S. contact, Attorney General Eric Holder, the top law enforcement officer, is under pressure after a Republican-led Congress found him in contempt of Congress for withholding documents in a gun-running sting operation. But all of that could be trumped by the "fiscal cliff" - a combination of tax hikes and automatic spending cuts that will take effect at the end of the year if lawmakers in the Democratic-controlled Senate and Republican-controlled House are unable to reach a compromise. By that point, if the Swiss haven't got a deal, they will face an even longer wait. LEAKY EUROPEANS The going is equally sluggish closer to home. Crisis-hit European countries in need of extra income are delaying settlement with Switzerland as a flourishing trade in leaked bank client data tilts the talks further in their favor. Those leaks are also complicating an agreed but as-yet unratified tax deal with Germany -- whose citizens hold an estimated 150 billion euros in Swiss accounts -- key to Switzerland's attempts to make amends in Europe. Prosecutors in the German state of North Rhine-Westphalia said on Thursday they had new bank data with which to pursue tax evaders, strengthening the hand of opposition politicians who say Chancellor Angela Merkel is letting tax-dodgers off too cheaply and should re-word the agreement. Germany has promised to stop buying data naming tax cheats when the new deal between it and Switzerland comes into force, but the latest incident suggests that may be an incentive for officials to drag their heels in ratifying the agreement. It also underscores the position in which Switzerland finds itself: out of negotiating room. "All Swiss banks can do now is wait it out," said Thomas Braun, founder and partner of fund management firm Braun, von Wyss & Mueller. (Reporting by Katharina Bart; Additional reporting by Martin de Sa'Pinto in Zurich, Tom Miles in Geneva and Kevin Drawbaugh in Washington; Editing by Sophie Walker) |