US and Swiss governments agree on step closer to removal of secrecy laws

By Marc Castro

Aug 30, 2013 08:51 AM EDT

The governments of the United States and Switzerland have formalized an agreement to allow a number of Swiss financial institutions to pay fines in order to avoid or defer criminal prosecution on charges of tax evasion by bank clientele. This agreement is a step closer towards a resolution of the dispute between the two countries.

The agreement would apply to about a hundred second-tier Swiss banks, without which would be required to disclose previously determined confidential information. The banks would also be penalized by as much as 50% of the value of the assets managed for American clients,

The agreement though does not cover those already being investigated by US authorities. These include the largest of the Swiss banks, namely Credit Suisse and Julius Baer.

This deal is in line with the long standing goal of the United States to pierce the veil of Swiss bank secrecy laws. Analysts say it is too ealy to determine the fees that Swiss banks would need to pay or how much extra revenue would revert to the US banking system.

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