Legal

Switzerland Sued Over UBS Client Data Transfer To US

Tom Burroughes Group Editor London May 9, 2011

Switzerland Sued Over UBS Client Data Transfer To US

UBS clients have sued Switzerland for allegedly violating privacy rights in an agreement with the US allowing transfer of account data.

UBS clients have sued Switzerland at the European Court of Human Rights for allegedly violating their privacy rights in an agreement with the US that allowed the disclosure of their account data, media reports said.

The court "received a number of applications concerning the administrative assistance agreement between Switzerland and the US", the Strasbourg, France-based tribunal reportedly said.

UBS could not be reached for comment at the time of this publication going to press.

The court case stems from the agreement in 2009 when US and Swiss authorities agreed that UBS should pass over thousands of account details to the US authorities to resolve a civil legal case in which the Swiss bank had been accused of helping wealthy US citizens evade taxes. UBS also agreed to pay a $780 million fine to resolve a separate criminal case surrounding tax evasion.

The latest development highlights how the assault on Switzerland's centuries-old tradition of bank secrecy has proven difficult. Tax evasion is not, unlike in many other countries, a crime in Switzerland. 

A US client of UBS, whose account data was disclosed to US authorities, has recently sued Switzerland, according to the Handelszeitung publication. The suit said there were violations of his right to privacy, equal treatment and the presumption of innocence, the Zurich newspaper said without identifying the plaintiff.

Since the UBS case, a number of Swiss banks, such as Wegelin and Julius Baer, have ceased to provide offshore banking to US clients. 

Register for FamilyWealthReport today

Gain access to regular and exclusive research on the global wealth management sector along with the opportunity to attend industry events such as exclusive invites to Breakfast Briefings and Summits in the major wealth management centres and industry leading awards programmes