U.S. and Swiss Said to Reach Deal in Offshore Tax Evasion Probe

The U.S. and Switzerland agreed to resolve a long-running dispute over offshore tax evasion by letting some banks voluntarily disclose wrongdoing and turn over account information on American clients, a senior Justice Department official familiar with the matter said.

The accord divides Swiss banks into four tiers: 14 banks under criminal investigation; those allowed to avoid prosecution by disclosing wrongdoing; those without wrongdoing to disclose; and those complying with U.S. anti-tax evasion law, according to the person, who isn’t authorized to discuss the matter publicly and asked not to be named. Total penalties by banks making voluntary disclosures could exceed $1 billion, the person said.