Click here to watch or read more information on IRS Back Taxes.<\/a><\/p>\nPerhaps to answer that question, one needs to understand the history behind the famed Swiss banking secrecy. It might interest you to note that the times in which Swiss banking secrecy found its origin is not dissimilar to the condition of the world today. It was in 1934 when the US was experiencing the Great Depression that impacted the rest of the world (sound familiar?). Back then, different parts of the world were experiencing various forms of chaos \u2013 bank failures, economic depression, the rise of authoritarian ideologies like fascism, militarism and communism. Nazi Germany made it illegal to have assets overseas under penalty of death, the French socialists created an uproar over certain of their wealthy citizens holding Swiss bank accounts. It was in many ways, a world turned upside down.<\/p>\n
Against this backdrop, the Swiss created a new banking law that respects privacy and ensures secrecy to shore up the world’s confidence in Swiss bank accounts and their security.<\/p>\n
The scenario today is eerily almost a mirror image of what it was like in the 1930’s minus the threat of extreme ideologies like fascism and communism. But other aspects of the era of the 30’s are present today, albeit in a different form. Unrestrained government spending, poorly regulated fiscal policies, unhealthy competition among banks resulting in compromise of strict business standards, overly high leveraging of funds, living on credit that we think will last forever are all elements of our world today.<\/p>\n
Closer back home, we have Democrats in Congress who constantly want to push up tax rates, AIG employees forced to ‘voluntarily’ give up their legally owned income through political pressure and even a proposal to collect salary data on CEOs who do not support the government’s Obama-style policies. Over the years, the Swiss have always thrived on providing banking solutions to overseas clients whose governments are over-spending. Is history repeating itself?<\/p>\n
Little wonder why UBS chief Grubel is still optimistic of his bank’s future in the grand scheme of things. He contends that wealthy people are always on the lookout for safe banking havens to shield their assets against economic instability in their home countries and Switzerland is still a much safer place to invest one’s assets than the US, UK or any other country.<\/p>\n
I think he is right.<\/p>\n
Nevertheless, Grubel will do well to learn from the bitter experience of the IRS UBS spat. If the Swiss banking secrecy system is to survive and thrive, Swiss banks must not be guilty of soliciting customers by helping them evade taxes, launder their money or commit any other such misdemeanor.<\/p>\n
As long as they keep their noses clean, the world still needs the Swiss.<\/p>\n
Check out more IRS Reports<\/a> stories by clicking that link.<\/p>\n