Black money stashed in Swiss banks can be returned: report

LONDON: Huge funds pillaged from developing countries by dictators and stashed in Swiss banks can be returned to their original jurisdiction, effective from this month, to assist with aid projects as a sequel to historic legal reforms passed by the Switzerland government.

According to a report in The Times, the Swiss government has passed a federal act on the restitution of assets of savers, such as former President of Egypt Hosni Mubarak, that allows the authorities to confiscate frozen assets and, subject to conditions, return them to the country of origin.

At the same time, London and Berne are on the verge of reaching a historic legal deal that could turn Swiss banks into de facto agents of Revenue and Customs.

The UK government is pressing its counterparts to force Swiss bankers to assess the tax liabilities of UK residents with funds in their institutions.

The move comes as clients of Swiss banks are becoming increasingly nervous after a spate of data thefts, the most recent being the transfer several weeks ago of two computers discs to WikilLeaks by Rudolf Elmer, a former Zurich-based banker.

Judith Ingham, head of Geneva office of Withers said, "Many Swiss banks are saying, by way of a huge change from their previous stance, we would now like clients to become tax-compliant in their home jurisdictions.

And many are saying that if you don't become compliant in your home jurisdiction, we will not be able to continue to give you the full service that we have done in the past."

"That is a sea change. You can see 55-year-olds trying to make their mouths move in a way that says this. It is not something that they've ever been interested in or worried about in the past."