Swiss drop US Senate trip to protest UBS treatment: report

By AFP

July 15, 2010 Updated Feb 22, 2009 at 2:00 PM CDT

Switzerland has cancelled an appearance before a US Senate sub-committee to protest US government treatment of its biggest bank, UBS, over tax fraud claims, the ATS news agency reported Sunday.

"The Swiss government regrets that the US Department of Justice has threatened UBS with unilateral measures despite the cooperation of the bank and the Swiss authorities," ATS reported, citing a letter sent to the US Senate.

It said the Swiss government was always ready to cooperate with the United States on the basis of legal provisions and bilateral accords already in place.

A US Senate committee meeting on UBS under Democratic Senator Carl Levin was scheduled for Tuesday but has now been put back to March 4, ATS said.

On Wednesday, UBS, Switzerland's biggest bank, reached a settlement with US authorities in which it admitted to US tax fraud and agreed to pay 780 million dollars. It was also ordered to hand over details of 250 to 300 US clients.

However, the US Justice Department then launched a separate lawsuit to force UBS to name another 52,000 US customers who allegedly evaded taxes.

UBS vowed to fight the court action, which strikes directly at the bank secrecy laws at the heart of Switzerland's role as a major international financial centre.

The Swiss government has insisted that bank secrecy remains intact.

Many governments, however, have made improving bank transparency a top priority in tackling a global credit crunch and slump sparked by massive losses in the banking system on complex, opaque financial instruments.

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