The Swiss government has cobbled together a task force to defend its legendary banking secrecy laws that have allowed wealthy US and European citizens to evade taxes in their home country and park their gains, often ill-gotten, in Swiss banjs, famed for their tradition of total client confidentiality.
The US and Europe have been mounting increasing pressure on the Swiss government to allow greater disclosure on the banking details of the Swiss bank clients.
With the US government trying to force Swiss bank UBS to reveal the identities of 52,000 Americans who have allegedly evaded taxes, Switzerland's finance minister Hans-Rudolf Merz has enlisted leading personalities from the country to defend the country's banking secrecy from pressure.
In a surprise move today UBS appointed a new group chief executive officer to battle the banks financial crisis as well as fight the lawsuit in the US.
Marcel Rohner, the present CEO has been replaced with immediate effect by Oswald Grübel, former head of the Credit Suisse.
Merz, told a news conference that he has enlisted justice minister Eveline Widmer-Schlumpf, foreign minister Micheline Calmy-Rey Merz along with bankers, diplomats, economists and legal experts to come up with a strategy to protect banking the interests of the country from nations that threaten to undermine its banking secrecy laws.
The task force is also in response to increasing pressure from European leaders who have vowed to launch a global crusade against tax havens at the April G-20 summit in London, where US President Barack Obama, who had called UBS 'tax cheats', will also be present.
"Pressure has been building up on an international level about the tax system. We need legal experts, those who know the situation in the US and in Switzerland. Also bankers, economists and people with diplomatic expertise," Merz said at the news conference yesterday.
Even though Switzerland's requested to be allowed to attend the April G-20 summit, has been rejected, Merz will be travelling to London next month hoping to hold meetings with international finance ministers before the start of the summit, as EU nations have threatened to draw up a list of uncooperative on tax haven countries against whom sanctions can be imposed.
UBS, the world's largest private bank, had hoped that by agreeing last week to pay $780 million to settle civil and criminal charges filed against it last year for defrauding the IRS, by cooperating would resolve matters.
But late last week the US justice department filed a lawsuit in the federal court in Miami to compel Switzerland's largest bank, UBS, to disclose the names of as many as 52,000 Americans who held cash and securities in secret accounts in UBS. (See: US justice dept hauls UBS to court to force disclosures)
The lawsuit was filed despite UBS providing data on 250 to 300 of its US account holders, which led to the Swiss government coming under immense criticism. The government responded saying it averted criminal charges against UBS employees as well as saved the Swiss economy.
Yesterday many US clients of UBS filed a lawsuit against the bank and the Swiss financial regulator, financial market supervisory authority (Finma) for violating Swiss banking laws for having revealed 300 US client names to the US authorities and also aims to prevent further disclosures.
The suit was filed by Andreas Rued, a lawyer in Zurich, on behalf of nearly a dozen UBS clients from the US and the lawsuit has also named Peter Kurer, chairman of UBS and Egen Haltiner, chairman of Finma as defendants.
Justice minister Eveline Widmer-Schlumpf will also talk to the US officials on the UBS case during his trip to the US next week.
Swiss banking laws does not recognise evading taxes as breach of any law in Switzerland. The country's banking secrecy laws ban banks in Switzerland from disclosing any information to authorities of another country about their clients, except in cases of fraud and the 52,000 names that US authorities are asking for have not been accused of having committed any fraud in the US.