The End of Banking Secrecy for Foreign Clients — conclusion

Conclusion

For seventy-five years after 1934, banking secrecy and the Swiss distinction between tax evasion and tax fraud protected foreign clients who held undeclared assets in Swiss banks. The European Savings Tax Agreement of 2004 introduced a withholding tax without information. The UBS case of 2007 to 2010, in which the American authorities forced the disclosure of client data, showed that banking secrecy could not protect a bank that depended on the American market. On 13 March 2009, the Federal Council adopted the OECD standard on the exchange of information on request. Data thefts and their purchase by foreign governments undermined banking secrecy from within. The Rubik agreements failed after the rejection by Germany in 2012. The American programme for Swiss banks of 2013 resolved the past with penalties of billions of dollars, including against Credit Suisse and the Basler Kantonalbank. FATCA and the Common Reporting Standard introduced the automatic exchange of financial account information, which Switzerland applies since 2017. Behind these milestones lay a longer history, from the origins of the criminal protection of secrecy in the crisis of the 1930s to the white money strategy of the Federal Council and the domestic amnesties of 2010. For clients, the transition meant voluntary disclosures in Germany, France and Italy, administrative assistance proceedings before the Swiss courts and the exposure of opaque structures through leaks, while bank employees learned that the protection of secrecy did not extend to them. Banking secrecy survives for Swiss residents and against private third parties, although it has ceased to protect foreign tax evasion. The Swiss private banks have had to reinvent their business on the basis of tax compliance, quality and stability. The next chapter examines the practice of wealth planning in this new environment.

For general information only. This article does not constitute legal or tax advice, does not replace advice on an individual case and creates no lawyer-client relationship. It reflects the legal position as of August 2025.