Scarinci Hollenbeck, LLC
The Firm
201-896-4100 info@sh-law.comFirm Insights
Private Swiss Bank Closes Over Tax Evasion Dispute With U.S.
Author: Scarinci Hollenbeck, LLC
Date: October 28, 2013
Key Contacts
Back
Private Swiss bank Frey & Co AG announced that it’s closing its doors due to “unsustainable costs” stemming from the country’s dispute with the U.S. over alleged tax evasion. Frey will be the second bank – following Wegelin and Co. – to close after allegations of helping Americans evade U.S. tax law.
U.S. authorities have launched an investigation into several Swiss institutions for their complicity in tax law violations. A government program currently exists that enables Swiss institutions to voluntarily come forward and detail their actions in exchange for reduced penalty rates. Under the agreement, participating banks are required to disclose the amount of undeclared American assets on their books and pay related penalties. However, Frey is one of the 14 institutions ineligible for the program because it is already under investigation by the Department of Justice, Reuters reports.
Although Frey has not been indicted by the Justice Department, shareholders for the institution noted that increased regulatory scrutiny – and the costs associated with compliance – are too burdensome for the small bank. In addition, U.S. authorities have indicted Stefan Buck, the bank’s former head of private banking, for allegedly assisting Americans in hiding taxable income from the Internal Revenue Service, according to the Wall Street Journal.
“As a result of developments in recent years, circumstances and challenges have presented themselves, especially in Switzerland, that mean it no longer makes sense for a small bank to continue its cross-border services,” said Markus Frey, chairman of the board who founded the institution in 2000. “Bank Frey will therefore cease its operative business activities as a bank.”
Several Swiss institutions are currently under investigation for similar violations. The increased scrutiny is due in large part to the IRS’s attempt to close the multibillion-dollar tax gap, which the IRS estimates to be $385 billion.
- Practices: Tax and Trusts & Estates, International Law & Trade, Sophisticated Estate Planning & Wealth Preservation
- Locations: Red Bank, NJ, New York City, Little Falls, NJ
No Aspect of the advertisement has been approved by the Supreme Court. Results may vary depending on your particular facts and legal circumstances.
Related Posts
See all
Dissolving Your Business: Essential Legal Steps to Protect Your Interests
If you’re considering closing your business, it’s crucial to understand that simply shutting your doors does not end your legal obligations. Unless you formally dissolve your business, it continues to exist in the eyes of the law—leaving you exposed to ongoing liabilities such as taxes, compliance violations, and potential lawsuits. Dissolving a business can seem […]
Author: Christopher D. Warren
The Role of Corporate Restructuring in Mergers & Acquisitions
Contrary to what many people think, corporate restructuring isn’t all doom and gloom. Revamping a company’s organizational structure, corporate hierarchy, or operations procedures can help keep your business competitive. This is particularly true during challenging times. Corporate restructuring plays a critical role in modern business strategy. It helps companies adapt quickly to market changes. Following […]
Author: Dan Brecher
Crypto Enforcement: A Former Prosecutor’s Warning to Criminals and the Public
Cryptocurrency intimidates most people. The reason is straightforward. People fear what they do not understand. When confusion sets in, the common reaction is either to ignore the subject entirely or to mistrust it. For years, that is exactly how most of the public and even many in law enforcement treated cryptocurrency. However, such apprehension changed […]
Author: Bryce S. Robins
Understanding Chattel Paper: A Key Component in Secured Transactions
Using chattel paper to obtain a security interest in personal property is a powerful tool. It can ensure lenders have a legal claim on collateral ranging from inventory to intellectual property. To reduce risk and protect your legal rights, businesses and lenders should understand the legal framework. This framework governs the creation, sale, and enforcement […]
Author: Dan Brecher
Crypto Compliance: A Comprehensive Guide
For years, digital assets operated in a legal gray area, a frontier where innovation outpaced the reach of regulators and law enforcement. In this early “Wild West” phase of finance, crypto startups thrived under minimal oversight. That era, however, is coming to an end. The importance of crypto compliance has become paramount as cryptocurrency has […]
Author: Bryce S. Robins
Supreme Court and Title VII: Implications for Reverse Discrimination
Earlier this month, the U.S. Supreme Court issued a decision in Ames v. Ohio Department of Youth Services vitiating the so-called “background circumstances” test required by half of federal circuit courts.1 The background circumstances test required majority group plaintiffs pleading discrimination under Title VII of the Civil Rights Act to meet a heightened pleading standard […]
Author: Matthew F. Mimnaugh
No Aspect of the advertisement has been approved by the Supreme Court. Results may vary depending on your particular facts and legal circumstances.
Sign up to get the latest from our attorneys!
Explore What Matters Most to You.
Consider subscribing to our Firm Insights mailing list by clicking the button below so you can keep up to date with the firm`s latest articles covering various legal topics.
Stay informed and inspired with the latest updates, insights, and events from Scarinci Hollenbeck. Our resource library provides valuable content across a range of categories to keep you connected and ahead of the curve.