The Swiss newspaper NZZ provides a summary of the so far 57 settlements of Category 2 Banks out of an estimated 90+ participating in the US Tax Program.
The 57 banks paid in total $550m in penalty, whereas BSI Bank paid the highest amount with $211m and Banca Intermobiliare di Investimenti e Gestioni (Suisse) did not need to pay anything. These banks managed 16,416 US-related accounts. However, the counting of accounts is unlikely to be fully standardized across the banks. During the applicable period of the US Tax Program starting with accounts open on or after August 1, 2008, the banks managed aggregated US related assets of around $23.3bn. The banks paid 2.36% in penalty of these aggregated assets.
The article mentions that such a comparison of percentage of penalty of the aggregated assets has limited meaningfulness because it is unknown what revenue and respective profits resulted from these assets over the years. It is also not known how many of these accounts and assets were always declared or declared during a voluntary disclosure in the past or during the US Tax Program or even still undeclared.
The various business strategies with US clients, wrongdoings and other facts can be found in the Statement of Facts for each Bank. Wheather these statements are entirely correct remains unclear. According to the NZZ a bank representative argues that these Statements of Facts abounds in mistakes. There was no opportunity during the discussions with the US authorities to react against these documented statements says this person. Furthermore the banks that settled with the Department of Justice are not allowed to comment such matters in public. Interviewed bankers and lawyers, that negotiated also with the US authorities, explain that it is clear that the US view is prevalent in these settlements. Traditional Swiss banking services like hold mail, credit and debit cards for accounts where the banks did not question the tax status of their clients are denounced.
Nevertheless, those polled mentioned that there was a possiblity to have a certain influence on the wording in the Non-Prosecution Agreement. Some banks achieved to include also some of their wording, whearas other bank’s documents include mainly the DoJ’s view.
If the negotiation skills of the banks and their adivsors really had an influence on the penalty will be asserted when the US Tax Program for Category 2 banks is finished. Banks might have chosen big renowned law firms that have a lot of experience and manpower, but might not have been able to act fully independently. Defendors of big law firms like to change sides in the US to the public procesutor’s office or vice versa. It remains to be seen if banks that counted on smaller, less experienced but maybe less unbiased, had an advantage.
In general the settlements show that the US DoJ verifies the situation of each bank in details. The more US related assets a bank had the higher in general the penalty was. If a bank aquired new US clients with undeclared assets after August, 2008, had a specific US strategy or allowed US clients to hide money in specific offshore structures or with insurance wrappers the penalty increased as well.