The president of Switzerland, Hans-Rudolf Merz, has asked Treasury Secretary Tim Geithner to abandon a major Justice Department-led lawsuit that is threatening to tear a huge hole in the Alpine nation’s bank-secrecy laws, threatning its lucrative niche as a tax haven.
The DOJ and the Internal Revenue Service are seeking the names of 52,000 Americans who used Swiss bank UBS to evade U.S. taxes through the use of overseas accounts. A source told the New York Times that DOJ “is not going to give in” on the matter.
Switzerland instead is proposing to negotiate a new treaty with the U.S. that would allow disclosures of such names in the future, in exchange for the U.S. dropping its current investigation. Treasury issued a statement Sunday saying Geithner “listened to the Swiss concerns” and understands “the importance of appropriately resolving the matter.”