ECONOMY

Cracking the Vault

With help from a former UBS banker, the Feds are demystifying how the Swiss do business. Inside the tradecraft.

By Evan Thomas and Mark Hosenball | NEWSWEEK
Published Mar 14, 2009
From the magazine issue dated Mar 23, 2009

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  • Posted By: stoneymason @ 09/01/2009 6:51:06 PM

    Put Your Money in a Swiss Bank.?
    You must be joking.
    Trust a Swiss Bank .?
    Ask the Jews.

    Swiss Bank Secrecy.

    Bank Secrecy Covers:- all your business relations with the bank.
    Protects all contacts with a view to opening an account, even if the account is never actually opened . It concerns all the people who work for the bank or in contact with it .
    Any Banker who reveals information about you without your consent risks a custodial sentence.
    Bank employees are subject to up to 50,000 francs fine and six months in jail should they disclose ??? any information??? on an account or an account holder .
    For law enforcement to get ???Lifting Order??? they must first convince a ??? Swiss Judge.??? That you have committed a serious crime punishable by the Swiss Penal Code.
    Bankruptcy. ??? Falls under Federal Law which provides for the recognition and application of foreign ruling in Switzerland. The bank account can be seized without difficulty .
    The bank is under obligation to declare all property held for the account of the bankrupt debtor.

    Swiss Criminal Code.

    Article. 162. Swiss Criminal Code. Confidential Business Information.
    Article. 320. Swiss Criminal Code. Occupational Confidentiality.
    Article. 97. Swiss Criminal Code . ??? to compensate for damages
    incurred for ??? violating its duty of secrecy.???

    Fine and imprisonment for the banker pursuant to the banking act and criminal code.
    Damages for the client pursuant to the duty of care.

    *** The Swiss Public Attorney automatically begins prosecution as soon as the offence is made known. ( the exception being).

    The Rolls Royce of Swiss Banks. ( Swizz Banks.)
    Pictet & Cie.-------Mr.Ivan Pictet.

    Pictet & Cie.- claim they are the ???Rolls Royce???of Swiss banks.

    Swiss Banks or more correctly Swizz banks.

    Swizz. ---- ??? a great disappointment.??? or a ??? fraud.???

    Fraud. ---??? an intentional deception or dishonesty.?????? ???a crime.???

    Crime. ---??? an act committed or omitted in violation of a law.???

    Serious Crimes .

    Conspiring to pervert the Course of Justice.
    Perverting the Course of Justice.
    Contempt of Court.

  • Posted By: stoneymason @ 05/17/2009 6:47:42 PM


    Pictet & Cie.- claim they are the ???Rolls Royce???of swiss banks.

    Swiss Banks or more correctly Swizz banks.

    Swizz. ---- ??? a great disappointment.??? or a ??? fraud.???

    Fraud. ---??? an intentional deception or dishonesty.?????? ???a crime.???

    Crime. ---??? an act committed or omitted in violation of a law.???

    Serious Crimes .

    Conspiring to pervert the Course of Justice.
    Perverting the Course of Justice.
    Contempt of Court.


    The Establishment ??? Cover up crimes???.

    The ???Doyens??? of the establishment.??? ( Ivan Pictet and Monty Raphael.)

    Ivan Pictet.
    Managing partner in Pictet & Cie Bank .--- Switzerland.
    President of the Geneva Financial Centre.
    World Bank.committee member.
    United Nations. Investment Committee member,
    Vice President ??? Global Humanitarian Forum.
    Member of the Henokiens.
    Blackstone Group --- Board Member.
    Past- President ??? Geneva Private Bankers association.
    Past ???President ??? Geneva Chamber of Commerce and Industry.


    Monty Raphael.
    Quote.??? ---- Doyen of U.K. Fraud lawyers.
    Consultant & Head of Fraud and Regulatory Dept.
    Member of Board of Directors of the Fraud Advisory panel.
    Member of the Law Society of England & Wales.
    International Bar Association Member.
    Past President???London Criminal Court Solicitors Association.
    Past Chairman ---of Anti Corruption Committee.
    Founder of Business Crime Committee of the International Bar
    Association.


    Pictet & Cie Bank & Peters & Peters.

    The bank and it???s officials deliberately withheld crucial documents requested under a High Court order.The bank and it???s officials deliberately withheld evidence from the Police , and one of it???s account managers Susan Broadhead gave a false witness statement to the police.
    Another one of it???s managers Nicholas Campiche ( Now Head of Pictet ??? Alternative Investments.)concocted a letter pretending to be a client and closed his account. The senior partner (Ivan Pictet.)sought to have numerous documents destroyed,along with those copies held in their London office of P.A.M. Initially stating that they were forgeries then their lawyers Peters & Peters ??? Monty Raphael ??? and the barrister Charles Flint.Q.C.) ???later had to admit in Court that the documents were genuine.

  • Posted By: milushpark11 @ 05/14/2009 8:07:26 AM

    well, I don't know about rejecting, I am sure that if you have enough money, every bank in Switzerland will accept you with open arms..I actually find it kind of strange that these new rules only apply for US resident. Anyone around the world can open a Swiss bank account online and with no minimum deposit, I read the information at
    http://open-bank-account.com

  • Posted By: Acharn @ 03/20/2009 12:58:53 AM

    Ah, yes, UBS the employer of McCain's economic advisor and major architect of the current meltdown, Phil Gramm! Although it's heartwarming to see them getting a little heat this isn't really going to stop their scam. "Regrets", indeed. It was also gratifying to read that they took a good-sized hit on CDO's, which were Gramm's major legacy to U.S. taxpayers.

  • Posted By: atsallys @ 03/19/2009 1:05:05 PM

    I just met with a former UBS vp yesterday who quit and transferred to a new bank. Am starting to wonder why now.

  • Posted By: Omaar @ 03/17/2009 9:00:39 AM

    Bankers, the IMF and the FED are in Control, Not the President.

    For more than a year, the U.S. Federal Reserve System has been increasingly acting as the world's central bank, injecting hundreds of billions of dollars into foreign government treasuries in an effort to increase liquidity in those countries.

    It represents a stark break from the prior role of the Fed, moving it into territory more traditionally occupied by the International Monetary Fund (IMF).

    The program puts both the Fed and the foreign central banks at increased risk.

    The U.S. taxpayer has also bailed out foreign banks indirectly by pumping billions into American Insurance Group, which announced Sunday that it had forwarded that cash to counterparties that include foreign banks such as Societe Generale, Deutsche Bank, Calyon, Credit Suisse, the Royal Bank of Scotland and Barclays.

    That's down from a December peak of nearly $600 billion, as central banks have repaid some of the loans.
    Story continues below

    In exchange for U.S. dollars, the Fed has received foreign currency of equivalent value in an exchange known as a swap. To protect the Fed from losses due to currency fluctuation, the deals include a provision that when the moneys are swapped back, the transaction will be done at the same exchange rate as the initial transaction.

    The Fed has established relationships with some major banks, such as the European Central Bank and the Bank of Japan, but also with central banks overseeing smaller, more volatile economies, such as the Banco Central do Brasil.

    "What happened last fall, when the credit markets seized up so badly, was really a departure because some additional countries that would not have been in the Federal Reserve swap network in earlier years at all were brought in, like the central bank of Brazil, Bank of Mexico, and some smaller ones like the bank in New Zealand, the Norwegian central bank and so on."

    The full list of participating banks, according to the Fed, includes the Reserve Bank of Australia, Bank of Canada, Danmarks Nationalbank, Bank of England, Bank of Korea, Banco de Mexico, Reserve Bank of New Zealand, Norges Bank, Monetary Authority of Singapore, Sveriges Riksbank, and Swiss National Bank.

    The program was launched in December 2007 and initially engaged in relatively small swaps with the European Central Bank and the Swiss National Bank.

    On September 15, 2008, Lehman Brothers filed for bankruptcy, sending a shock through the global financial sector and freezing credit markets. While the media focused on the U.S. government's domestic response -- a $700 billion bank bailout -- it missed the global response. Between Sept. 15 and October 1, the U.S. nearly quadrupled its swaps with foreign central banks, increasing the amount to $233 billion.

    Two weeks later, the total was $398 billion and a week after that it was $480 billion. Two months after the Lehman bankruptcy, the Fed had swapped $572 billion.

    • Posted By: emmarcee @ 03/17/2009 10:35:57 AM

      Wouldn't we rather keep more of these foriegn exchange than keep our Dollar which does not have any backing other than the American Govt 's word? Is n't this swap good for us in the long run? How about Swiss banks in this game? America wants them to open up, right?
      You seem to have very good knowledge about this.

      • Posted By: Omaar @ 03/18/2009 10:20:02 AM

        Thank You.

        But the Emphasis has got to be placed on the Government taking the Power of the FED, a Private Corporation of Bankers, Making the US Dollar without having [[GOLD]] to back the Dollar up.


        That's the central Problem, the FED is Coining and Making US Currency out of Thin Air !!!

        That DEVALUES our CURRENCY even MORE !!

        Again, had GOLD BACKED our CURRENCY we wouldn't be in this SAD SHAPE ECONOMICALLY in fact our Currency would be STABLE or INCLINING opposed to DECLINING.

    • Posted By: emmarcee @ 03/17/2009 10:34:55 AM

  • Posted By: Omaar @ 03/18/2009 10:13:35 AM

    There is No Damn [[Left Or Right]] in Politics.....

    There is ONLY Capitalism and Big Time Capitalist OWN Both Political Parties...

    That's the Sad Azz.... REALITY.

    That's the Game Big Time Capitalist Play on the COMMON SHEEP.

    Its called a Monopoly....

    Controlling the Game on all Sides, so the Capitalist Agenda Continues, whether there is a Democrat or Republican in Power....

    How Stupid can some of You Low Life's Be !!!!!

  • Posted By: nawawimohamad @ 03/17/2009 5:35:10 AM

    Don't put the blame on the Swiss. They are what the are, trying to make money and survive. That is their business. They have to promote their business like other businesses. The US is in a state of denial that everything in the US has gone beserk. The US cannot control its economy (it can't even control the CEOs from getting tons of money) and trying to penalise others for it. Blaming is one thing but harassing the Swiss and tiny Liechtenstein, this shows that the US is just a big brainless bully.

  • Posted By: MJPD345 @ 03/16/2009 7:11:00 PM

    Imagine what an annual , mandatory 10% " Bad Citizen " Surtax would do for the U.S. ?? Any volunteers ?? No ?? Tough.. You will have to pay anyways ... It's that short of Repealling the Graham / Ruggman Corporate tax code that got us into this mess in the first place..

  • Posted By: jglammi @ 03/15/2009 8:29:46 AM

    If the US were really interested in money and legality, not to mention morality, it would repatriate all illegal aliens. For example, Los Angeles County alone reports spending one BILLION dollars per year on the children of illegal aliens.

    • Posted By: Dogstarr @ 03/16/2009 12:26:08 PM

      Yeah, this article is really about "illegal aliens", geez, I guess everything is for you, right?

      • Posted By: jglammi @ 03/16/2009 5:04:34 PM

        The article addresses legality, ethics, and money, 3 elements that the US government is not at all consistent on. We in Los Angeles County suffer the consequences.

  • Posted By: bowater @ 03/14/2009 7:53:22 PM

    The USA cannot bow to the wishes of the EU and their high tax regimes. the reason why they want the Swiss banks out of the picture is so they can raise taxes. Soon, we will follow. Those rich people would gladly pay some taxes. But not when the taxes are spent by a bunch of liberal baffoons.
    The other banks in the world should emulate the Swiss, not try to destroy them. If all countries were "tax havens", the citizens would keep their money at home.
    All these high tax liberal socialist countries would rather destroy the Swiss banks than to COMPETE with them. What happened to the US competitive spirit. Our desire to be competitive has been the reason why we are so great. Let's COMPETE with the Swiss. Let's have an incentive for our US citizens to keep their money in the USA. Let's beat the Swiss at their own game.
    Senator Levin spent years trying to force the Swiss to give up the names of US citizens that have accounts at Swiss banks. If he would have spent all that time and our taxpayer money finding ways to COMPETE with them, we wouldn't be talking about it today .And besides that, let the USA once and for
    all quit meddling in the affairs of another country.
    If the Swiss have no privacy, look for a WORLD WIDE SURGE IN TAXES

    • Posted By: Dogstarr @ 03/16/2009 12:33:45 PM

      I think the actions to open up the secrecy of the Swiss banks has more to do with pressuring other countries that claim to be part of the international community to play by the same rules and with the same transparency that most countries do.

      I'm sure that there are other countries that will continue to try to be safe havens for tax avoidance, but it's really way past the time that Switzerland should have stopped playing this game. The Swiss banks most certainly should have been completely opened up to international scrutiny after World War II.

    • Posted By: Osama Bin Login @ 03/16/2009 11:35:26 AM

      "baffoons"

      Learn to spell, Jethro.

  • Posted By: Omaar @ 03/16/2009 12:05:16 PM

    Wall Street on a 4 Day Rally after the FED's Ben Bernanke's 60 Minutes interview...

    OK, Blame this rally on Obama as well.


    Wall Street Moves Higher, Building on 4-Day Rally


    NEW YORK ??? Investors are sending stocks mostly higher on reassuring comments on the economy from Federal Reserve Chairman Ben Bernanke. The Dow Jones industrials and Standard & Poor's index are rising for a fifth straight day as financial stocks again lead the way.

    In an interview Sunday on CBS' "60 Minutes," Bernanke said the economy could end its recession in 2009 if the government's program to boost the banking industry succeeds. Those comments come after some of the nation's hardest hit banks said their operations were improving. That is giving investors some encouragement about the sector.

    The Dow is up 114 at 7,338 in midday trading. The S&P 500 is up 13 at 770. The tech-heavy Nasdaq composite index is down 1 at 1,431.

  • Posted By: Omaar @ 03/16/2009 11:23:02 AM

    The Banking Elite Control Both Political Parties...

    Wake Up...

    Whether Republican or Democrat.

    McCain would do the Same Thing, so Stop the Nonsense of Political Party Madness.

    America Needs to have [[Gold]] to Back it's Currency Once Again..

    AN I MEAN NOW !!
    ----------------

    The Dollar Stopped being Backed by [[Gold]] in 1913, when Woodrow Wilson signed the [[Federal Reserve Act]] and it was a big mistake, had our Currency continued to Made by the Government and Backed by [[Gold]] Our Economy would be in Great Shape, just look at the Price of Gold.
    ---------------------

    We would not have to Borrow Money from [[Communist-Socialist China]] we would be one of the Nations other than Brazil and Canada Surviving and Thriving in this Economic Down turn, but alas, the Federal Reserve, a Private Corporation, Controls and Prints our Currency and thus we are in this Financial Bind...

    If the FED had continued to have [[Gold]] to back our Currency, I would have Nothing Against the FED Printing the Money, but [[Gold]] does not back the US Dollar...

    Sorry

    The FED is Creating Money out of Thin Air, it's an Legal Form of Counter Fitting, being that the FED has the LEGAL RIGHT to Print our Currency !!!
    ------------------

    The Bankers Deception and their Control Extends itself to Both Political Parties.
    -------------------

    Bankers, The FED, Corprate Greed, Banks in General, Wall Street, S&P, NASDAQ, Speculators, Big Oil, Politicians and Land Development are all [[Akin]] they are all a part of the Elite Capitalist deception, to the Common Man.

    They are All Inter-Connected.

    There is No Political Party, when it comes to the Following Facts....
    -----------------

    The Bankers Rule Politicians

  • Posted By: The Messiah @ 03/16/2009 10:09:58 AM

    I'll bet there are a lot of puckered arsses on Corruption Hill.

  • Posted By: The Messiah @ 03/16/2009 10:09:24 AM

    I'll bet there are a lot of puckered arses on Capitol Hill.

  • Posted By: Global Citizen @ 03/16/2009 6:32:12 AM

    If a may, let me give a more nuanced view of Swiss bank secrecy. Swiss bank secrecy does not protect any criminal activities according to Swiss law - which of course also include funding of terrrorism, money laundering - etc. but only protects assests to a certain extent from tax agencies. The reason for this limited access is, that Swiss tax law is based on an honour code, similar to those of some Ivy League US Colleges. If you don't declare an account - though without frauding documents, bills etc, this would be tax fraud, and is also a crime- then the tax agency just takes away 35% of the interest earned, without knowing details of the account. As soon as you declare the account, you get the 35 % back, minus the taxes you have to pay. It is as such a system with an incentive, and results in a very lean tax agency, unlike most countries, where tax agencies are bloated, money consuming monsters, quite like the Spanish Inquisition. Tax collection does not cost much. If a foreign citizen has money in a Swiss account, and does not declare it, his home country gets the 35 %, if Switzerland has an agreement with that country (it does with most industrialized states. It should also be mentioned that Switzerland has been on the forefront of cooperating with the US in the fight against terrorism. Funding of terrorism is not protected by the bank secrecy It has one of the strictest legislations on money laundering, much stricter as say the US state of Delaware or the Cayaman Islands.

  • Posted By: Global Citizen @ 03/16/2009 6:31:54 AM

    If a may, let me give a more nuanced view of Swiss bank secrecy. Swiss bank secrecy does not protect any criminal activities according to Swiss law - which of course also include funding of terrrorism, money laundering - etc. but only protects assests to a certain extent from tax agencies. The reason for this limited access is, that Swiss tax law is based on an honour code, similar to those of some Ivy League US Colleges. If you don't declare an account - though without frauding documents, bills etc, this would be tax fraud, and is also a crime- then the tax agency just takes away 35% of the interest earned, without knowing details of the account. As soon as you declare the account, you get the 35 % back, minus the taxes you have to pay. It is as such a system with an incentive, and results in a very lean tax agency, unlike most countries, where tax agencies are bloated, money consuming monsters, quite like the Spanish Inquisition. Tax collection does not cost much. If a foreign citizen has money in a Swiss account, and does not declare it, his home country gets the 35 %, if Switzerland has an agreement with that country (it does with most industrialized states. It should also be mentioned that Switzerland has been on the forefront of cooperating with the US in the fight against terrorism. Funding of terrorism is not protected by the bank secrecy It has one of the strictest legislations on money laundering, much stricter as say the US state of Delaware or the Cayaman Islands.

  • Posted By: No apathy here @ 03/16/2009 1:47:46 AM

    UBS should be given 7 days to pony up the info or the option of getting out of the U.S. in 30 days. If they are doing business in America they are subject to American law. What precedent does it set if a corporation is allowed to operate in America under the laws of their home country? If UBS is allowed to claim protection under Swiss law how long will it be before other foreign corporations do the same? WE MUST NOT ALLOW THIS PRECEDENT TO BE SET!!!!

  • Posted By: No apathy here @ 03/16/2009 1:47:12 AM

    UBS should be given 7 days to pony up the info or the option of getting out of the U.S. in 30 days. If they are doing business in America they are subject to American law. What precedent does it set if a corporation is allowed to operate in America under the laws of their home country? If UBS is allowed to claim protection under Swiss law how long will it be before other foreign corporations do the same? WE MUST NOT ALLOW THIS PRECEDENT TO BE SET!!!!

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