Category 1 banks are the institutions that were already under investigation by the DoJ at the time of the publication of the US Program on August 29, 2013. They are excluded from the Program.
Individual delivery of U.S. requested information. This includes information about in- and outflows of funds from and to other banks without giving client names (leaver lists). They need to find a solution based on direct negotiations with the Department of Justice (DoJ).
Fines are defined on an individual basis.
They generally enter into a Deferred Prosecution Agreement (DPA).
Category 2 banks are not already under investigation by the Department of Justice (DoJ) and have reason to believe that they have committed tax-related offenses.
The banks need to deliver information about the cross-border business for U.S. Related Accounts (USRA) as well as names and functions of individuals who structured, operated and supervised this business. Among other information the banks also need to hand-over information about the transfer of funds into and out of USRA accounts closed during the applicable period. The transmission to the DoJ of names and functions of relationship managers as well as other third parties associated with these accounts are another requirement by the Program.
The fine is based on a lump sum calculation for undeclared U.S. Related Accounts with different fixed fine rates of the maximum aggregate dollar value of such accounts.
These banks will seek Non-Prosecution Agreements (NPA).
Category 3 banks are those that believe they have not engaged in activities that could have breached U.S. law. An Independent Examiner (e.g. U.S. or Swiss law firm or accountant) will need to verify this.
Information about the total managed U.S. assets need to be provided by these banks as well as a confirmation that effective compliance programs are in place.
They do not need to pay a penalty but the handling costs endured by fullfilling the requirements of the Program is born by these banks.
They will be able to seek Non-Target Letters (NTL).
Category 4 is reserved for banks with a local client base according to the definition of FATCA.
The certification of the FATCA status is required by the US Program.
No fine needs to be paid.
These banks will be able to seek Non-Target Letters (NTL).
UBS enters into Deferred Prosecution Agreement admitting to have helped U.S. taxpayers hide accounts from IRS. The bank agrees to identify customers and pay a penalty of $780m.
The Swiss Federal Parliament rejected the Lex USA mainly because the unilateral US Tax Program was considered too far reaching. Lack of legal certainty with regards to the admission of banks to participate in the US Tax Program and the absence of an agreement with the US authorities were other key factors to say no.
Swiss Model Order to authorize Swiss Banks to cooperate with the US Department of Justice. On the basis of these principles, banks have the option of applying for an individual authorisation based on Article 271 of the Swiss Criminal Code that governs “activities carried out on behalf of a foreign state”.
Switzerland and United States of America sign Joint Statement to settle a long-standing tax dispute between Swiss banks and U.S.
Following a number of requests for clarification, the Tax Division of the US published comments linked to the U.S. Program. These highlight some of the issues, but do not replace any provision of the Program.
Deadline for submission by banks of their Letter of Intend to participate in the program under Category 2 with an option to later turn to Category 3.
The Tax Division of the Department of Justice further commented on the Program for Non-Prosecution Agreements or Non-Target Letters for Swiss Banks. The main take out is the deadline extension for Category 2 Banks.
Acquittal of Raoul Weil. The verdict was reached after only over an hour while the government took 6 years since the indictment to bring R. Weil to court
Extended deadline for submission of Letter of Intent by banks wishing to participate in Category 3 or 4 of the Program. The window for these categories does not open before July 1, 2014.