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Practice Update
More of Your Assets May Be Exposed Than You Think
December 21, 2011
By Sherwin P. Simmons II, Drew LaGrande, Barbara Ruiz-Gonzalez, Jonathan Gopman, and Leanne Reagan

Following the precedent set by the United States Government’s settlement with UBS in 2009, the United States Government has offered eleven (11) financial institutions in Switzerland and Israel a settlement agreement in which the United States Government’s investigations in these financial institutions for aiding tax evasion and potential prosecution would be dropped.  The terms of this agreement would be similar to the UBS settlement in 2009 and would require each of the eleven (11) Swiss and Israeli financial institutions (the “Swiss and Israeli Banks”) to share data regarding United States clients and, most likely, pay a fine.

The eleven (11) Swiss and Israeli Banks are believed to be Credit Suisse, Julius Baer, HSBC Switzerland, Basler Kantonalbank, Zürcher Kantonalbank, NZB Neue Zürcher Bank AG, Wegelin & Co. Privatebankiers Gesellshafter Bruderer Hummel, Tolle & Co., Liechtensteinischen Landesbank, Bank Leumi le-Israel Trust Company Ltd., Bank Hapoalim and Mizrahi Tefahot Bank.  For further information on Credit Suisse and the disclosure of United States client status, please visit our previous Practice Update dated November 18, 2011 by clicking here.

Based on the settlement in 2009 with UBS, and on various news sources at this time, it appears that the Swiss and Israeli Banks would need to turn over, at the very least, the following:

  1. Correspondence between the Swiss and Israeli Banks and United States clients (which includes notes regarding telephone conversations and meetings);
  2. Internal memoranda relating to United States clients; 
  3.  Correspondence between the Swiss and Israeli Banks and third parties concerning United States clients; and
  4. Documents related to funds transferred to third parties on behalf of United States clients.  
Initially, it appears that this information will be "blacked-out" with respect to client information, but this has not been confirmed at this time.  Either way, at some point in the future, identifying information will be shared. 

In the event that you are a United States person who holds an account with a Swiss and/or Israeli Bank or an undeclared or unreported account with a financial institution anywhere outside the United States, it is imperative that you contact our team immediately in order to review all viable options.

This Akerman Practice Update is intended to inform firm clients and friends about legal developments, including recent decisions of various courts and administrative bodies. Nothing in this Practice Update should be construed as legal advice or a legal opinion, and readers should not act upon the information contained in this Update without seeking the advice of legal counsel.

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