Switzerland’s private banks have started to ban their top executives from travelling abroad, even to neighbouring France and Germany, because of fears they will be detained as part of a global crackdown on bank secrecy.
The head of one leading private bank in Geneva said the growing determination of countries such as the US and Germany to tackle tax evasion and secrecy meant banks felt they had to take extra measures to protect employees.
“Some banks have taken this precaution,” he said. “If today I go to Germany to visit two banks I deal with…German customs can take me in and question me.”
The travel bans, which have not been brought in by all banks, have focused on those visiting the US, following the detention there last year of a senior private banker from UBS, Switzerland’s biggest bank, as part of a federal tax investigation.
The head of the private bank, which itself has no travel restrictions, said: “Today if you are a banker from Switzerland going to the US you have to fear you will be taken in for questioning. I am thinking twice about going to America.”
However, four people in the private banking industry in Geneva told the Financial Times of banks bringing in total travel bans for staff, even for adjoining European countries.
“Private bankers aren’t even travelling to France. The partners are not leaving Geneva at all,” said a senior industry figure close to several private banks. No bank contacted by the Financial Times wanted to discuss the matter publicly.
The restrictions come ahead of next week’s Group of 20 summit where a clampdown on tax havens is set to be discussed.
Under pressure from other countries, Switzerland, which is estimated to account for about a third of the world’s $11,000bn in clandestine personal wealth, agreed this month to ease its bank secrecy laws and accept international standards on tax transparency.
From their discreet offices on a luxury goods shopping street overlooking Lac Leman, private bankers in Geneva reacted this week with a mixture of intense anger, at what they see as an unjustified attack by big countries, and concern about the threat to their business model.
“It is not really about bank secrecy; it is about solving an internal problem [for the big countries] by finding an enemy outside to bash,” said one senior banker.
26 Mar 2009 7:08pm
By Richard Milne in Geneva
Source: The Financial Times