Understanding the Swiss Bank Program: Resolving Tax Liabilities with the U.S.

The Swiss Bank Program, initiated by the United States Department of Justice (DOJ) on August 29, 2013, offered a structured path for Swiss banks to address potential criminal liabilities in the U.S. This program was specifically designed for Swiss banks that believed they might have committed tax-related criminal offenses concerning undeclared U.S.-related accounts. It’s important to note that banks already under criminal investigation for their Swiss banking activities, along with individuals, were not eligible for this program.

The DOJ’s Tax Division provided further details and updates on the Swiss Bank program in November 2013 and June 2014, clarifying its scope and requirements.

To participate in the Swiss Bank Program and potentially avoid prosecution, banks were required to meet several stringent conditions:

• Full Disclosure of Cross-Border Activities: Participating banks had to provide a comprehensive overview of their operations involving cross-border transactions and clients.
• Detailed Account-by-Account Information: Banks needed to furnish extensive details for each account where U.S. taxpayers held a direct or indirect interest.
• Cooperation with Treaty Requests: Banks were mandated to cooperate fully with U.S. treaty requests for account information, ensuring transparency and legal compliance.
• Information on Fund Transfers: Banks were obligated to disclose information about other financial institutions involved in transferring funds into or out of secret accounts, aiding in the tracing of illicit financial flows.
• Account Closure for Non-Compliant Holders: A critical requirement was the agreement to close accounts of U.S. accountholders who failed to comply with U.S. reporting obligations, reinforcing adherence to tax laws.
• Payment of Penalties: Finally, banks were required to pay appropriate penalties, reflecting the severity of past non-compliance and contributing to the resolution process.

Swiss banks that fulfilled all these requirements became eligible for a non-prosecution agreement (NPA) with the U.S. Department of Justice, effectively resolving potential criminal liabilities within the United States.

Non-Prosecution Agreements Under the Swiss Bank Program

The following table lists banks that entered into Non-Prosecution Agreements under the Swiss Bank Program. Each entry includes the bank name, the date of the agreement, links to the press release, and the NPA documents including attachments and statements of facts where available.