About a month ago, three officials from Wegelin, Switzerland’s oldest bank, were indicted for abetting tax evasion. Now the bank itself has gone down the same path as the Justice Department indicts Wegelin on charges of assisting wealthy American taxpayers hide their taxable income in offshore accounts with the bank. It is estimated that at least $1.2 billion has been hidden in bank accounts held in Wegelin, based in St Gallen.
The latest move by the Justice Department has certainly set off speculation as to which bank the US government will go after next. A private banker based in Geneva commented, “It seems the US is shooting at everything in sight and we don't know when it's going to stop. I think the chances of another bank being indicted are pretty big. After all, why should the U.S. stop? Switzerland is small, it’s an easy target, but a lot of money can be made out of it. When this whole thing started we didn't know how far the US would go, but now we've found out.”
The recent events have caused many Swiss private bankers to avoid stepping into the US, even for personal holidays for fear of being arrested. The events have also prompted the sale of the 270 year old bank, which took place last week.
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