U.S. senator Levin says the bank's actions amount to "declaration of war". Zurich-based UBS has declined to give U.S. authorities the names of as many as 52,000 Americans with secret Swiss bank accounts in its charge.

Although he acknowledged the bank's culpability as part of an agreement reached between UBS and U.S. prosecutors, UBS' CFO Mark Branson yesterday told a U.S. Senate subcommittee that it would provide no more than 250 to 300 names it has already handed over.

"We believe that UBS has now complied with the summons to the fullest extent possible without submitting its employees to criminal prosecution in Switzerland," Branson told the panel -- adding that the solution to the problem lay in diplomacy rather than in court battles.

Midwestern hyperbole

The subcommittee's chairman, senator Carl Levin of Michigan, contended that the Swiss bank's role in helping U.S. citizens and resident aliens evade U.S. taxes amounted to a "declaration of war against honest, hard-working taxpayers."

Last month UBS admitted to having committed tax fraud by urging wealthy U.S. clients to open accounts in Switzerland in order to keep income hidden from the IRS. The bank agreed to pay a fine of $780 million.

While the Justice Department says it is entitled to the names of all Americans with UBS accounts in Switzerland, the bank interprets the tax treaty between Switzerland and the U.S. as requiring it to give up no more information than it has already provided.

The Swiss government, which is also under pressure from several Western European countries -- especially the U.K. -- to identify citizens and legal residents with Swiss accounts, declined to send a representative to the Senate panel.

Earlier yesterday UBS tossed its chairman Peter Kurer out and replaced him with Kaspar Villiger, an ex-politician and businessman. Kurer was UBS top staff attorney when he replaced Marcel Ospel last year. -FWR

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