January 17, 2011 - Phil Hodgen
Bank Julius Baer continues to sit on the hot seat. It is still my favorite as the next target for the U.S. government.
It is likely that some of its customers are about to get an uncomfortable letter from their country’s tax authorities. I’m not saying that the employees of Bank Julius Baer have done anything evil. I’m just saying that a lot of eyeballs are looking in that direction right now.
Rudolf Elmer is back
I have written about Rudolf Elmer before. He’s a disgruntled former employee of Bank Julius Baer. When he didn’t get the severance package he wanted, he leaked some files to Wikileaks.
Today he turned over information on 2,000 customers to Wikileaks. See the article in The Guardian or Bloomberg. He handed the disks straight to Julian Assange. The man sure knows how to generate publicity. (Thanks T. for the email.)
Mr. Elmer goes on trial tomorrow in Switzerland for violating bank secrecy laws.
This is how it goes
This is the way it goes for the tax authorities. Someone gives (or sells) the tax authorities inside information. Secrecy is breached. The investigation expands. Expense and imprisonment follow.
- The specific customers identified publicly will be scrutinized, and it is quite likely that prosecutions for tax evasion will be brought.
- The bank itself may be pressured to disclose information on pain of prosecution. The UBS case gives us a good template for that scenario.
- And the Swiss government, having conceded to U.S. pressure in amending the income tax treaty, will be pressured to disclose bank information by treaty request from the U.S. government.
Pro tip: into action
- If your name might show up on Wikileaks as a Bank Julius Baer customer? Do. Not. Wait. One. Day. Get yourself to a lawyer. Don’t whine. Be decisive and act.
- If you are a Bank Julius Baer customer and you are lucky enough to have avoided Mr. Elmer’s list? Be proactive. Take remedial action, fast.
- If you feel comfortable at the moment, remember that it just takes one rogue individual to leak your private affairs to the world. Be serious, get serious, and take serious action.