UBS Australia Will Retain Offshore Business Despite US Exit - Report

Tom Burroughes

30 July 2008

The Australian arm of UBS will continue providing offshore banking services to clients, despite its US counterpart banning the practice amid a major US crackdown on tax evaders, according to The Australian newspaper.

UBS's US operations decided on the ban earlier this month after it was caught up in a congressional enquiry into tax avoidance, which also exposed the private tax dealings of Australia's second-richest man, Frank Lowy.

However, UBS Australia has ruled out following suit.

"Our business model is not going to change," a UBS spokeswoman was quoted as saying.

The spokeswoman said the Australian offshore investment model was different from that of the US because of different reporting requirements, but she was unable to explain further.

According to the Australian Taxation Office, $5 billion flowed from Australia to known tax havens each year, with much of that driven by wealthy individuals.