Swiss Private Bankers' Group Fires Warning Over Exchange Of Information

Tom Burroughes

28 March 2017

A Swiss private banking group has urged lawmakers in the Alpine state to insist on more checks before information is passed abroad under international pacts, saying it is concerned about confidential data going astray.

The call, from the Association de Banques Privées Suisses, comes at a time when Switzerland’s famed bank secrecy laws are seen as fading into history as global agreements, such as the Common Reporting Standard, take effect in successive stages, starting from this year.

A concern voiced in recent years is that exchanging information can lead to data getting into the wrong hands without safeguards.

“Switzerland already appears to be moving faster than others by publicly announcing plans to implement the automatic exchange of information (AEoI) with at least 79 states or territories, possibly even 83, if one includes Singapore, Hong Kong, Panama and the Bahamas, with whom agreements may be signed in 2017,” the association said in a statement yesterday.

The association noted that since the start of this year, banks have been collecting tax information for 38 countries. The Swiss government proposes to add another 41 next year.

“However, the authorisation to be issued by Parliament does not exempt the government from verifying the existence of a level playing field and data confidentiality before information is exchanged in September 2019,” the association said.

“The ASPB does not oppose the adoption of the AEoI with these 41 countries but would like further verifications to be carried out before beginning to exchange with each of them. A global standard against tax evasion will work only if all international financial centres apply it effectively,” it continued.

“Before information is sent to a given country for the first time in September 2019, the ASPB wishes the Swiss government to ensure that it is not going it alone, and that its main competitors are also exchanging information with that country. In this context, all possible means must be brought to bear on the US, whose FATCA law is significantly less reciprocal than the OECD standard,” it said.

Confidentiality concerns
The association also said it is worried about confidentiality of data, particularly in Russia, Latin America and Asia.

“This does not concern taxation, but clients' physical safety, given the risk of corruption and political manipulation in their home countries. Data confidentiality should therefore be verified one last time before sending data abroad, even if this means delaying the AEoI where confidentiality cannot be guaranteed,” it added.

Association members are Bordier & Cie; E Gutzwiller & Cie; Gonet & Cie; Bank Lombard Odier & Co; Mirabaud & Cie; Mourgue d'Algue & Cie; Banque Pictet & Cie; Rahn+Bodmer Co, and Reichmuth & Co.