UBS Client in San Diego Gets Probation for Hiding Accounts

From Businessweek.com:

A UBS AG client in San Diego was sentenced to three years probation after pleading guilty to hiding assets in his Swiss bank accounts from the U.S. Internal Revenue Service.

Jeffrey Chatfield, a consultant who advised private companies that sought to go public, was also ordered to pay $96,000 to resolve his civil liability with the IRS, the U.S. Justice Department said today in a statement.

Chatfield filed false tax returns from 2000 through 2008 in which he failed to disclose his Bahamian and Swiss accounts at UBS and Credit Suisse Group AG, according to the Justice Department’s statement. The accounts held as much as $900,000 in untaxed securities and cash Chatfield received in 2000 from his consulting work, according to the statement.

UBS provided U.S. officials with Chatfield’s identity and account information as part of a deferred prosecution agreement under which the Zurich-based bank admitted helping U.S. taxpayers hide accounts from the IRS, the Justice Department said. Chatfield had moved his assets to a Credit Suisse Group AG account in 2004 and that bank told him in 2008 it was closing all accounts held by U.S. taxpayers, according to the statement.

Continued here

Swiss Warn Banks Over Offshore Accounts

Swiss banking regulators warned financial institutions in the country that they need to overhaul their services yesterday to prevent another legal battle with the IRS. According to the Wall Street Journal, the regulators suggested banks limit the risk of being pursued by U.S. authorities like USB was earlier this year.

"In its capacity as supervisor, Finma expects institutions to take due account of foreign supervisory legislation in particular, and to define a service model appropriate for each individual target market," Finma said in a statement.

The cost of doing business—both monetary and in reputation—with wealthy foreigners has risen considerably since the U.S. and European Union member states began piling pressure on Switzerland, eager to get at tax income from undeclared funds held in Swiss banks.

The highest-profile case is UBS, which was pursued by U.S. authorities in the criminal as well as civil courts over hidden Swiss accounts. UBS ultimately admitted wrongdoing, paid $780 million to defer criminal prosecution, and handed over thousands of sets of data on clients to set aside the litigation. The U.S. is expected to set aside the civil court case shortly.

The UBS case has wide implications for other Swiss banks, many of which have traditionally dealt with assets of foreign clients, some of it undeclared, according to private bankers.

Last year, Switzerland ceded some ground, finally bringing it in line with standards laid out by the Organization for Economic Cooperation and Development. For example, it now helps foreign nations pursue tax evaders as well as outright cheats.

Read more here

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EU-US Agree to Share Citizens Bank Data

Just a few weeks after a deal was finalized with the Swiss to provide information about clients from UBS, President Obama is taking the next step in his commitment to crack down on offshore tax evasion. On Thursday he announced a deal between the United States and the European Union to share banking data.

"The threat of terrorism faced by the United States and the European Union continues and, with this agreement, all of our citizens will be safer," Obama said in a statement released by the White House.

"This new, legally binding agreement reflects significant additional data privacy safeguards but still retains the effectiveness and integrity of this indispensable counter-terrorism program," he said.

European MPs earlier Thursday voted 484-109 for a new five-year deal to allow the United States to again have access to banking information from August 1.

The Terrorist Finance Tracking Programme had allowed US access to information from the interbank money transfer system SWIFT, which is based in Brussels, but EU lawmakers' main concern was how personal information would be used by US authorities.

UBS Customers: You May Want To Call The IRS Right Now

Customers of UBS that have not come clean about their association with the troubled financial giant should speak up before it’s too late. After a lengthy debate, the Swiss Parliament and UBS have agreed to finally release the names of 4,450 clients.

According to the Business Insider, if you've still got a secret Swiss bank account with UBS that you haven't told IRS authorities about, now may be the time. You may have mere hours to do so, before the Swiss do it for you, according to Bloomberg.

The Swiss Parliament recently passed a law forcing UBS to reveal the names of 4,450 clients.

One New York law firm, Rubinstein & Rubinstein LLP, said they've been getting, "panicked calls all week."

So, if you happen to be, or think you might be one of the 4,450, it might be time to make some phone calls.

Swiss Upper House Backs UBS Deal With U.S.

On Thursday, a Swiss and U.S. deal to end the tax dispute involving UBS was approved by the upper house and is closer to being approved by the full Parliament. The lower house is expected to vote on the deal next week and many predict they will give the package a thumbs up as Switzerland’s main political party officially took back their objection to the deal in May.

“The vote of the SVP will also be key in the lower house,” said Fabio Abate, a member of the Liberal Party who sits in the lower house. “But I think in the end a majority should back the UBS deal.”

However a green light is not yet certain.

“I think it will be slightly more difficult in the lower house,” President Doris Leuthard of Switzerland told the television network SFInfo when asked about the chances of the lower house supporting the UBS deal.

The upper house also voted on Thursday against allowing a referendum on the tax deal. But the question is still open on whether the lower house would do the same, Mr. Abate said. A referendum would delay by several months the UBS agreement from coming into force.

Continue reading at NY Times.com…

Crying Foul, Ex-UBS Banker Starts Prison Term

From the Wall Street Journal:

Former UBS AG private banker Bradley Birkenfeld, the key informant in the landmark U.S. case against the Swiss banking giant, reported to a federal prison in Pennsylvania Friday, while his lawyers stepped up their criticism of the U.S. Justice Department for prosecuting him.

Mr. Birkenfeld, speaking by phone while traveling to the Schuylkill County Federal Correctional Institution in Minersville, Pa., said prosecutors and the courts had treated him differently from the kinds of tax cheats he revealed to the government.

"Every single UBS client is pretty much walking away free, either house arrest or probation," said Mr. Birkenfeld, who began serving a 40-month sentence for helping UBS clients evade U.S. taxes. He pleaded guilty in 2008 and was sentenced last August.

Mr. Birkenfeld has spent recent months seeking to have his sentence reduced or postponed. And he has questioned the Justice Department's decision to indict him, given his role in helping U.S. tax authorities reach two major settlements with UBS that poked unprecedented holes in Swiss bank secrecy.

UBS Informant Files Complaint With DOJ

According to ABC News.com, the key whistleblower in the UBS tax evasion case - Bradley Birkenfeld – filed a complaint on Tuesday that prosecutors made false statements to the judge who sentenced him to prison.

Attorneys for informant Bradley Birkenfeld asked for an in internal Justice Department investigation and said the "inaccurate, misleading and incomplete" allegations should be corrected. The complaint was filed with the department's Office of Professional Responsibility, which investigates ethical matters involving prosecutors and other employees.

"These statements had a material impact on Mr. Birkenfeld, and caused the Department of Justice to improperly seek jail time for one of the most important tax whistleblowers in American history," wrote Birkenfeld attorneys Stephen Kohn and Dean Zerbe in the complaint.

Justice Department spokesman Charles Miller declined comment.

Birkenfeld, 44, is scheduled to begin serving a prison term Friday of more than three years. He and his attorneys — affiliated with the National Whistleblowers Center — have embarked on a campaign to reduce or eliminate the sentence based on his disclosures, which led UBS last year to pay a $780 million fine and agree to reveal names of thousands of suspected American tax cheaters.

Informant Says He Will Assist Further in Tax Case Against Swiss Bank

Bradley Birkenfeld, a former UBS banker and informant in the UBS case is now saying he can further assist in the tax case against the bank. He was slated to start a three year prison sentence early in January, but is reportedly hoping that additional cooperation with the government will reduce that sentence.

As this article on NYTimes.com explains, Birkenfeld was sentenced in August, but filed a new postponement request earlier this week with a federal district court in Florida.

The filing also requested a hearing to reconsider the 40-month sentence imposed on Mr. Birkenfeld on Aug. 21.

Prosecutors described Mr. Birkenfeld as the man most responsible for igniting an investigation into rich Americans’ use of secret Swiss bank accounts to avoid taxes. Partly because of Mr. Birkenfeld’s disclosures, UBS has agreed to disclose to the United States the names of 4,450 wealthy Americans suspected of hiding assets and dodging taxes in secret accounts.

The United States Treasury loses an estimated $100 billion a year to offshore tax cheats.

Ex-UBS Banker Seeks Billions for Blowing Whistle

Last Friday Lynnley Browning of NYTimes.com posted an article on Bradley C. Birkenfeld, and his chances of a billion dollar payout from the IRS. For those of you who might not be familiar, Birkenfeld was a private banker at the Swiss bank UBS. He divulged the tax evasion secrets of the bank and, as part of a Federal deal, admitted to helping hundreds of taxpayers.

Bradley C. Birkenfeld was sentenced to 40 months in prison for helping rich Americans dodge their taxes. Now, as thousands of wealthy Americans seek amnesty for keeping illicit, offshore bank accounts, Mr. Birkenfeld and his lawyers hope to use a new federal whistle-blower law to claim a multibillion-dollar reward from the American government. If they succeed — and legal experts say the odds are pretty good — it would be the largest reward of its kind.

Mr. Birkenfeld, who is to begin his prison term as soon as January, is being represented by the executive director of the National Whistleblowers Center, Stephen M. Kohn. Mr. Kohn successfully represented Linda Tripp, who helped expose the Monica Lewinsky scandal of the Clinton years. “We are seeking at least several billion dollars,” Mr. Kohn said.

It might seem outlandish that Mr. Birkenfeld, who pleaded guilty in June 2008 to conspiring to defraud the United States government, would seek any reward at all. But experts in whistle-blower cases — who, admittedly, have an interest in fostering such claims — say he has a persuasive case.

“I do think he has a serious claim,” said Erika A. Kelton, a partner at Phillips & Cohen, a law firm that specializes in large whistle-blower claims. “It was very credible, very useful information from inside UBS that he provided. The law is pretty clean on this.”

1st UBS Client Charged By US Gets Probation In Tax Case

The results are in for the first U.S citizen to be tried in a UBS offshore banking case. Steven Rubinstein – an accountant from Florida – was ordered to pay a $40,000 criminal fine and sentenced to 3 years of probation after pleading guilty in court.

The sentence was lighter than the recommendation of prosecutors, who sought a one-year prison term for Rubinstein. He faced a possible sentence of 18 to 24 months under advisory sentencing guidelines.

Rubinstein was sentenced in a Florida federal court for filing a false tax return. Prosecutors charged him in April and he pleaded guilty in June.

Prosecutors said Rubinstein communicated with UBS bankers from 2001 to 2008 about the purchase and sale of securities worth more than 4.5 million Swiss Francs. They also said Rubinstein repatriated roughly $7 million into the U.S. to buy property and build a home in Boca Raton, Fla.

Continue reading at WSJ.com…

UBS Registered Mail Warns U.S. Clients

From Reuters.com:

Swiss bank UBS AG warned U.S. customers by registered mail their account details may be given to U.S. tax authorities, a method that could itself breach secrecy laws, a Swiss paper said on Sunday.

The use of registered mail and envelopes showing the sender was UBS could enable the U.S. authorities to trace customers wanted for tax evasion well before their details are handed over under a U.S.-Swiss double taxation agreement, Sonntag weekly paper said.

A spokesman for UBS declined to comment on the report.

Switzerland and the United States settled a row over evasion of U.S. taxes in August when Switzerland agreed to hand over details of 4,450 U.S. accounts at UBS.

But it could take into early 2010 before the first names are handed over under the agreed legal procedures.

Some 7,500 Americans voluntarily disclosed information about hidden overseas assets under a tax amnesty program that expired on October 15, according to the top U.S. tax collector.

US, Swiss Cement Deal On Secret UBS Bank Accounts

From Huffington Post.com:

The Swiss and U.S. governments announced a deal Wednesday to settle American demands for the identities of suspected tax dodgers, despite Switzerland's vaunted bank secrecy. However, they kept all details under wraps, including how many of the 52,000 names sought by the IRS from banking giant UBS AG will be revealed.

Depending on the scale of the deal, it could be a new blow to Switzerland's reputation as a safe place to hide assets from the taxman back home.

Switzerland has long been under pressure from European neighbors and the U.S. to open its bank records for foreign tax authorities. The IRS case against UBS has been partly credited with pushing the Swiss government to agree in March to comply with tax investigation rules from the 30-nation Organization for Economic Cooperation and Development. UBS earlier this year named about 300 American clients in a separate case.

William Sharp, a Florida tax lawyer who represents American UBS clients, said he expects the agreement to allow Swiss authorities to interpret bank secrecy laws more broadly and allow a "substantial handover" of names.

"I would guess that the U.S. would not enter into this agreement in the absence of a major fine and penalty without having at least several hundred if not thousands of names turned over," Sharp said.

The IRS in February asked U.S. District Judge Alan S. Gold in Miami to force Zurich-based UBS to turn over names of some 52,000 American clients believed to be hiding nearly $15 billion in assets in secret accounts. UBS and the Swiss government had resisted, arguing that to do so would violate Swiss banking confidentiality laws that date back centuries.

The Swiss and U.S. governments announced in late July they had agreed in principle on major issues but released no details. They had hoped to present a final deal at a hearing Aug. 7, but resolving the differences took longer.

On Wednesday, lawyers for the U.S. and UBS told the judge in a brief conference call they had sealed the deal.

Settlement Near in UBS Tax Evasion Case

According to the Associated Press the U.S. and Swiss government are close to reaching a deal over recent allegations that American taxpayers were using accounts to avoid paying taxes on the funds. The Federal government had planned to take UBS (the largest Swiss bank) to trial, but a Florida judge has canceled the trial after word broke that negotiations between the governments had been fruitful.

Justice Department attorney Stuart Gibson said Friday in a conference call with the judge that major issues have been resolved. He did not disclose details.

U.S. District Judge Alan S. Gold agreed to cancel a trial that was supposed to begin Monday.

The dispute involves about 52,000 Americans the U.S. believes are hiding billions of dollars of assets in UBS accounts. The bank and Swiss government say the names cannot be disclosed without violating long-standing Swiss bank secrecy laws.

U.S. Secretary of State Hillary Clinton and Swiss Foreign Minister Micheline Calmy-Rey are scheduled to discuss the issue Friday in Washington.

Swiss, U.S. Seen Needing Time to Ink UBS Tax Deal

The August 3^rd deadline for a settlement between Switzerland and the U.S. on the UBS case seems unlikely, according to several sources close to the case. Alibaba.com recently published a great article on the topic, explaining why a settlement is so hard to reach, and what the outcome is likely to be. You can read a segment of the story below.

Talks between Switzerland and the United States to end a tax row targeting UBS could stretch beyond an Aug. 3 deadline to allow more time for a detailed settlement, a source familiar with the situation said on Friday.

U.S. tax authorities are seeking to force Swiss wealth management giant UBS to disclose the identity of an estimated 52,000 U.S. holders of secret Swiss accounts suspected of dodging taxes even though this breaches Swiss bank secrecy laws.

A trial against UBS was scheduled to start in Miami on July 13 but presiding judge Alan Gold agreed to delay it until Aug. 3 to allow time for a settlement.

A status call between Gold and lawyers from UBS and the U.S. Internal Revenue Service on July 29 could be an opportunity for an announcement of a delay. A meeting between Swiss Finance Minister Micheline Calmy-Rey and U.S. Secretary of State Hillary Clinton is also scheduled on July 31.

"I would not be surprised if during the July 29 call or at the weekend there may be another request for a delay," a source familiar with the situation told Reuters.

Many investors believe the judge will again postpone the trial as the tax talks are complex and working out a deal that without further weakening bank secrecy requires time.

"Nothing will happen on Wednesday. The parties will agree to postpone the deadline until September to reach an agreement," a Swiss-based trader told Reuters.

Two Swiss-based sources familiar with the situation said a deal was unlikely to come before July 29.

UBS in Talks to Settle Case on 52,000 Accounts

After months of negotiation it looks like UBS, the largest Swiss bank, has finally agreed with the Federal government to give up the names of over 52,000 Americans who are suspect of using their accounts to illegally avoid paying their taxes.

According to Bloomberg.com, “UBS agreed to an unprecedented breach of Swiss secrecy laws by giving the Internal Revenue Service data on more than 250 accounts. Switzerland, which supports UBS in the case, said the U.S. push for data on 52,000 other accounts is a threat to its sovereignty and would force the bank to violate Swiss criminal laws protecting bank secrecy.

“Over the last week or so, there have been high-level officials from the two governments meeting, trying to narrow the issues and bring about a resolution,” Stuart Gibson, a Justice Department senior litigation counsel, told U.S. District Judge Alan Gold today at a hearing.

UBS attorney Eugene Stearns said the bank learned on July 11 about discussions between the Swiss and U.S. governments.

“We are anxious for the governments of these two democracies to resolve these issues,” said Stearns. “It’s a minefield trying to resolve these issues.”

Lynnley Browning of the New York Times also weighed in on the latest developments noting that “the dispute between UBS and the United States has escalated into a diplomatic drama and has threatened to pierce the veil of Swiss financial secrecy. UBS and the Swiss government have said they will not disclose client names, even if ordered by a judge, because doing so would violate Swiss laws governing financial secrecy and subject UBS executives to prosecution in Switzerland.”

In February, the Internal Revenue Service, backed by the Justice Department, sued UBS, the world’s largest private bank and a pillar of the Swiss economy, to force it to disclose the names of 52,000 wealthy American clients suspected of tax evasion through UBS’s offshore private banking division.

The Justice Department also increased its pressure on UBS on Sunday, saying in a separate filing that it would consider imposing unspecified monetary sanctions on the bank if it failed to turn over the names upon a judge’s order.

Swiss Seek U.S. Tax Deal Before UBS Case Continues

From Reuters.com:

A looming court case against Swiss bank UBS AG could prove a stumbling block to the United States and Switzerland clinching a tax agreement this week.

Switzerland, whose private banks manage around $2 trillion of foreign wealth, aims to secure 12 new bilateral tax deals by the end of 2009 which could allow it to be removed from an OECD "grey list" of states which need to improve tax cooperation and avoid possible sanctions from G20 nations.

It has already secured five agreements, with Denmark, Norway, France, Mexico and one other unnamed country, and plans to put the issue to a referendum. Talks between Swiss and U.S. officials restart in Washington on Tuesday.

Swiss President Hans-Rudolf Merz has asked U.S. Treasury Secretary Timothy Geithner to drop a tax evasion case against UBS in return for a new tax accord, which might struggle for ratification in Switzerland if the U.S. Internal Revenue Service (IRS) persists with its pursuit of the bank.

"We believe there has to be some kind of agreement before July 13 when the IRS and UBS are due to take part in a mini-trial," said analyst Teresa Nielsen at Vontobel, adding this could even come in an 11th hour deal on July 12.

Billionaire Tax Felon Says UBS Lied in Pledge to Report to IRS

A billionaire involved in the UBS tax scandals is saying that UBS lied to him by saying they would report his earnings to the IRS. You can read a segment of the Bloomberg article covering the story below, or find the full segment here.

California billionaire Igor Olenicoff had already invested $200 million with UBS AG in 2001 when his Swiss bankers ushered him to an underground vault in Geneva.

Olenicoff, a real estate developer with a taste for yachts and Russian art, saw floor upon floor of safe-deposit boxes. His private banker, Bradley Birkenfeld, and a colleague showed Olenicoff his own space for valuables.

“They said, ‘Whatever you want -- corporate stock, cash, gold, silver -- put it in here,’” says Olenicoff, 66, at the Newport Beach, California, headquarters of Olen Properties Corp., the company he founded in 1973. “It was that aura of legitimacy and secrecy. They say, ‘We’re the world’s largest wealth manager,’ so how do you question?”

Birkenfeld, 44, had spent years wooing Olenicoff, visiting his homes in Laguna Beach, California, and Lighthouse Point, Florida; cruising on his 147-foot (45-meter) yacht to Mayan ruins in Honduras; and flying on his Cessna Citation II jet.

Four years later, both men are admitted felons. Since December 2007, the billionaire and his banker have pleaded guilty to tax crimes.

The court cases open a door on the normally secretive world of dummy companies, offshore havens and phony financial filings that wealthy Americans often use to avoid paying U.S. taxes. President Barack Obama has proposed to end such tax breaks for U.S.-based multinational corporations and individuals within a decade.

‘Obligation of Citizenship’

“Most Americans meet their responsibilities because they understand it’s an obligation of citizenship,” Obama said on May 4. “Yet there are others who are shirking theirs. We shouldn’t let some citizens dodge their responsibilities, while ordinary Americans pick up the slack. Unfortunately, that’s exactly what we’re doing.”

The Olenicoff and Birkenfeld cases come amid a widening U.S. crackdown on offshore firms that cater to wealthy Americans. U.S. Senator Carl Levin, a Michigan Democrat, estimates the cost in unpaid taxes to the U.S. Treasury is $100 billion a year.

With evidence from the Olenicoff case and cooperation from Birkenfeld, U.S. prosecutors have been able to penetrate the veil of financial invisibility that Switzerland guards as a national treasure.

To avoid immediate prosecution, UBS, Switzerland’s second- largest bank by stock market value, behind Credit Suisse Group AG, agreed on Feb. 18 to pay the U.S. $780 million.

It renewed a pledge to stop unlicensed recruiting of customers in the U.S. and agreed to cooperate with investigators during 18 months of probation. The bank admitted in court that it had helped American clients dodge taxes from 2000 to 2007.

52,000 UBS Accounts

The bank turned over information on more than 250 customers -- an unprecedented breach of Switzerland’s bulwark of secrecy. The U.S. Internal Revenue Service is suing UBS in federal court in Miami to get the names of 52,000 American account holders who may have broken U.S. tax laws.

UBS is fighting back. The bank said in April 30 court filings that the U.S. efforts would force bank employees to violate Swiss criminal laws barring disclosure of secret account information. The Swiss government says the U.S. is trampling on its sovereignty.

UBS Tax Case Could Backfire On U.S.

Some experts feel the high profile case of the US vs. UBS could hurt its global economic standing, backfiring their original plan. Check out the following article from Reuters.com discussing the issue.

U.S. banks and the U.S. economy could suffer as a result of the high-profile tax evasion case pitting the Internal Revenue Service against UBS AG, supporters of the Swiss bank said in a federal court filing in Miami.

In a joint filing on Friday, five business and banking groups urged Federal District Court Judge Alan Gold to reject IRS demands that UBS (UBSN.VX) (UBS.N) reveal the names of 52,000 Americans suspected of using the bank to hide nearly $15 billion in assets and evade U.S. taxes.

Echoing a similar filing last month by the Swiss government, the petitioners said any exchange of confidential banking information should be handled through existing legal treaties rather than the courts.

The petitioners were led by the Swiss Bankers Association and Economiesuisse -- an umbrella group representing powerful Swiss industry, trade and economic associations.

They also argued that the IRS was seeking to embark on a "fishing expedition" and had no international legal standing to use a tool known as a John Doe summons to investigate suspected tax fraud by individuals whose identities and possible legal transgressions were unknown.

The IRS action violates both Swiss sovereignty and the framework of international law, the court filing says.

"Disregarding established treaty protocols and imposing conflicting obligations upon multinational enterprises, as the IRS urges, also would encourage courts in other jurisdictions to ignore established treaty protocol in taking similar measures against U.S. banks, enforcing subpoenas and similar broad-based information demands served on their overseas offices," it warned.

"Such a result not only would erode the primacy of U.S. law and treaty protocol, but could encourage non-resident aliens and foreign entities to withdraw significant deposits from U.S. based institutions to the detriment of the U.S. economy," it added.

"Further, imposing obligations on foreign businesses to violate their home country laws would discourage such businesses from entering the U.S. market."

The court filing offered no estimate of what it said could be "significant capital outflows" from U.S. financial centers, as one unintended consequence of the crackdown on UBS.

Switzerland Asks US To Drop Tax Case Against UBS

From the Wall Street Journal.com:

Switzerland asked the U.S. government to drop a legal case involving UBS AG (UBS) in return for passing a new tax accord between the two countries, a Swiss official said Sunday.

Swiss President Hans-Rudolf Merz said in Washington over the weekend that U.S. Treasury Secretary Timothy Geithner seemed "understanding of the Swiss position" and that he promised to "look into it," but didn't give a definitive answer, said the Swiss official, who declined to be named.

A U.S. Treasury official said Sunday that during the meeting with Merz on Saturday, Geithner "listened to the Swiss concerns regarding the UBS case and indicated that he understood the importance of appropriately resolving the matter."

UBS, Switzerland's largest bank, recently reached a settlement with U.S. authorities in which it agreed to pay $780 million in penalties and restitution to avoid criminal prosecution in connection with helping wealthy Americans hide accounts and evade taxes. Nevertheless, the U.S. continues to pursue data on more than 50,000 U.S.-based clients of UBS through civil means.

The U.S. Tuesday will start talks with Switzerland, famous for strict bank secrecy, on a bilateral tax treaty. The tax treaty negotiations will be conducted by the Treasury Department, with input from the Justice Department and the Internal Revenue Service, the Treasury official said.

The decision on how to take the case forward would be made by the Department of Justice and the IRS, which is part of the Treasury, the official said. It was not one in which Geithner would intervene.

"It would be very difficult to bring the accord to Parliament for approval with the case still pending," the Swiss official said, reporting what Merz, who's also the Confederation's finance minister, said Saturday after the International Monetary Fund spring meeting in Washington.

Switzerland is in the process of renegotiating dual tax agreements as part of concessions it made on banking secrecy, including agreeing to standards set out by the Organization for Economic Cooperation and Development on transparency and information exchange.

UBS no longer offers offshore banking in the U.S., or financial services out of Switzerland for wealthy Americans.

U.S. prosecutors recently obtained their first guilty plea from a U.S. client of the Swiss bank, as Floridian Robert Moran pleaded guilty in federal court to filing a false tax return and admitting to concealing more than $3 million in a secret UBS account.