May 7 (Bloomberg) -- A federal judge ordered Attorney General Eric Holder to “respond directly” to claims by the Swiss government that a U.S. lawsuit seeking the names of 52,000 UBS AG account holders would jeopardize a new tax treaty.

U.S. District Judge Alan Gold in Miami made the comments today in a telephone conference on a U.S. lawsuit against UBS, the largest Swiss bank. In a court filing and a diplomatic note last week, the Swiss government said the lawsuit would “seriously jeopardize” efforts to revise a 1996 tax treaty.

Gold told Justice Department attorneys to have Holder explain whether the lawsuit on behalf of the Internal Revenue Service represents the position of the entire U.S. government.

“If the attorney general doesn’t respond, I will take it that the IRS speaks on this matter both for the executive branch and the United States government,” Gold said in federal court.

Justice Department spokeswoman Beverley Lumpkin declined to comment on the judge’s comments.

The U.S. government, which sued on Feb. 19, must reply by June 30. UBS said in court filings that revealing the names of the 52,000 American account holders would force its employees to violate Swiss criminal laws that bar such disclosures.

The lawsuit came one day after UBS avoided U.S. prosecution for helping wealthy Americans evade taxes. UBS agreed to pay $780 million in penalties, admitted it helped taxpayers hide money in Swiss accounts, and gave the IRS more than 250 client names. Two UBS clients in the U.S. have been prosecuted for tax crimes since then, and the IRS is encouraging others to avoid criminal charges by disclosing offshore accounts voluntarily.

1996 Treaty

Under a 1996 treaty, Switzerland may turn over account data only on a reasonable suspicion of “tax fraud or the like,” according to a court filing. Unlike the U.S., the Swiss don’t view tax evasion as a crime.

In a diplomatic note sent April 29 to the U.S. government, the Swiss government said the lawsuit is a “direct challenge” to its sovereignty. It threatens negotiations to revise the 1996 treaty to share information with the U.S. on “not only tax fraud, but also tax evasion,” according to the note.

The IRS voluntary disclosure program, which requires taxpayers to pay taxes and interest for six years on offshore accounts, will better serve the agency’s goals, they wrote.

UBS has offered to provide clients with documentation for voluntary disclosures and “many thousands of clients have requested the necessary documentation or transferred their assets” to the U.S., according to the UBS filing.

Misleading Forms

As part of its deferred-prosecution agreement, UBS admitted Feb. 18 that from 2000 to 2007, its Swiss private bankers helped Americans evade U.S. taxes through sham offshore companies in tax havens including Panama, Hong Kong and the British Virgin Islands. UBS said it created misleading forms saying those companies, not taxpayers, were the beneficial account owners.

UBS also admitted that its private bankers marketed securities and banking services in the U.S., even though it didn’t have the required license from the Securities and Exchange Commission. Those bankers, UBS admitted, met with clients in the U.S. and communicated with them regularly as they traded securities in their accounts or transferred assets.

The case is U.S. v. UBS AG, 09-20423, U.S. District Court, Southern District of Florida (Miami).

To contact the reporters on this story: Mort Lucoff in Miami at morsybil@bellsouth.net; David Voreacos in Newark, New Jersey, at dvoreacos@bloomberg.net.

Last Updated: May 7, 2009 18:51 EDT