UBS exits offshore business in US

18 July 2008

UBS AG has decided to exit its offshore banking business for US clients, the Swiss banker's representative told a Senate committee hearing.

Mark Branson, chief financial officer of global wealth management and business banking, of the swiss banking group UBS, told  a US Senate subcommittee hearing on tax haven banks that UBS AG has decided to exit its offshore banking business for US clients and the bank was taking necessary action to address any compliance failures that may have occurred in the US cross-border business.

"That means UBS will no longer provide offshore banking and securities services to US residents through its bank branches. Such services will only be provided to residents of this country through companies licensed in the United States."

The senate subcommittee says tax evasion through offshore accounts robs the U.S. Treasury of $100 billion annually. and is investigating tax compliance by banks in countries designated as tax havens.

UBS, the biggest Swiss bank, is cooperating with tax-evasion probes by US prosecutors and regulators.  Branson told the subcommittee that UBS was working with the US government to identify the names of US clients who may have engaged in tax fraud.

Though cient identity is generally protected from disclosure under Swiss law, Branson said such privacy protections do not apply when disclosure of client names is requested in connection with an investigation of tax fraud and where the requests are presented to the Swiss government through established legal channels and that "UBS will fully support and assist that process," he aserted.