The US Internal Revenue Service is cracking down on wealthy Americans believed to be evading taxes by storing their money in Swiss bank accounts.
On Thursday it announced it would drop a civil lawsuit against the Swiss bank giant UBS after the company agreed to disclose details of nearly 4,500 clients.
Switzerland has long been under pressure from European neighbours to change its strict privacy policies.
According to lawyer Bryan C. Skarlatos, representing some of the people facing IRS investigation, UBS experienced enormous pressure on America’s part.
“They were going to put UBS out of business here in the United States if they did not get a settlement whereby UBS agreed to turn over this information,” he said.
Skarlatos added that now UBS is likely to face a lawsuit from its unhappy clients.
“They are very, very upset with UBS,” he said. “The IRS is only going after US taxpayers who were not reporting their income and bank account to the United States government or the IRS. People who were reporting correctly, the IRS has no problem with.”
“So it is hard for these taxpayers to cry foul play, but they are upset by UBS because UBS instructed them how to do this, told them it would be OK and then turned around and gave over their names, so there could be a lawsuit against UBS as well,” Skarlatos added.