Credit Suisse, Julius Baer May Close Undeclared German Accounts
Credit Suisse Group AG (CSGN) and Julius Baer Group Ltd. (BAER) are ready to close the accounts of German clients who can’t prove they comply with their tax requirements, officials at both companies said.
“We’re advising German customers to check their personal situation and if necessary to clean it up,” Marc Dosch, a spokesman for Zurich-based Credit Suisse, said today by phone. “If that doesn’t happen we will have to terminate the client relationship at some point.”
Switzerland, the world’s largest center for offshore wealth, is trying to shed its image as a haven for undeclared funds amid scrutiny from U.S. and European governments. The banks are also under pressure to crack down on tax dodgers as the Swiss government pursues a domestic “white-money” strategy for the financial center.
Credit Suisse is asking some German customers to provide documents proving they are tax compliant. German clients should check their compliance and clear it up if necessary, Chief Executive Officer Brady Dougan said in an interview with Handelsblatt newspaper last month. The move follows a rejection in December by Germany’s parliament of a proposed tax accord between Germany and Switzerland.
Zurich-based Julius Baer, which opened offices in Germany to try to retain customers who might repatriate funds, has said it no longer accepts any undeclared assets.
“We are encouraging our clients to carefully assess their fiscal duties and advising them to seek professional advice,” Jan Vonder Muehll, a spokesman for Julius Baer, said by phone today. While no accounts have been closed so far, “ultimately this could lead to the end of a relationship,” he said.
The comments follow an April 6 report in Switzerland’s Tages-Anzeiger newspaper that Credit Suisse, Julius Baer and UBS AG (UBSN), the nation’s largest wealth manager, may close accounts of German account holders who fail to provide documentation they’ve paid their taxes.
“We support clients in regularizing their assets,” Christoph Meier, a Zurich-based spokesman for UBS, said by e- mail on April 6.
Germany’s Parliament rejected a bilateral solution over undeclared accounts in Switzerland in November after opposition parties said the agreement contained too many loopholes for tax evaders. The accord proposed by the Swiss would have enabled customers to keep their identities secret while paying a withholding tax.
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