Numbered accounts profit from bank crisis
The fabled numbered Swiss bank account is shrouded in mystery – a mystery scarcely less deep than that surrounding their holders' identity.
Bankers shut up like clams at the mere mention of these accounts, as swissinfo.ch discovered. Questions about how many there might be, or what kind of person opens one, get short shrift in Geneva, Zurich or Lugano.
In the public imagination they are associated with spies, scandals and slush funds – quite undeservedly so, according to bankers.
“These accounts are subject to exactly the same duty of diligence as any other banking relationship,” UBS spokesman Dominique Gerster told swissinfo.ch.
“We are obliged to know the origin of the funds and the identity of the beneficiary. If we receive a legal request, we can supply the authorities with information, just as we can for any other account,” he said.
“We always know the identity of our clients, whether the account is a numbered one or not,” said Jan Vonder Mühll, head of media relations at private bank Julius Bär in Zurich. But more he would not say.
If a numbered account does not provide total anonymity, the fact remains that all documents containing the client’s name and address are placed in a safe and only a very limited number of authorised bank officials have access to it.
“A colleague from another branch of our bank couldn’t discover the identity of a client who has an account with us,” an asset manager at the Ticino branch of a cooperative bank told swissinfo.ch.
In contrast to other kinds of accounts, there is no database matching the name of the holder and the account number. “This gives extra protection to the client’s privacy,” he explained.
Last bastion of liberty
Even if the accounts are not – quite – as secret as the public likes to imagine, they are evidently still attractive to some.
“This is one of the last areas where there is still a little bit of freedom in the face of increasing regulation of banking activities,” said Chantal Bourquin, head of communication for the Association of Swiss Private Bankers (ASPB). “That explains why financial institutions are still keen to be discreet.”
James Nason, spokesman for the Swiss Bankers Association in Basel, laughed off the mysterious reputation of such accounts – after all, all accounts have numbers, he joked. But he was no more ready to spill the beans than any of the banks when it came to specific questions.
Increasing demand
Even if no one was prepared to give facts and figures, it seems that these accounts are more popular than ever, thanks to recent cases where whistleblowers have revealed the names of suspected foreign tax evaders to their home governments.
“Foreigners are now going for numbered accounts as a precaution, although this kind of banking was already highly valued by wealthy clients in the past,” said the Ticino asset manager, whose bank has benefitted from the flight of funds which weakened some of the major banks.
“There’s no doubt that given the attacks by the Italian government in particular, or to ensure that their details do not fall into the hands of some untrustworthy bank employee, our customers are becoming more and more demanding as far as confidentiality is concerned. And there is nothing better than a numbered account to respond to their expectations,” he explained.
Representatives of the other big banks approached by swissinfo.ch would neither confirm nor deny these remarks. Nason did admit that there could be a trend in this direction but did not say whether the members of his association were already benefitting.
Who needs anonymity?
It is not only for tax reasons that a numbered account can be attractive. In cases of divorce, inheritance or even blackmail it gives the holder additional protection. If there is a court case, the plaintiff has to name the bank where he believes the funds in question are held before proceedings can go ahead.
And that is a major advantage for potential victims of blackmail, such as politicians or celebrities.
Most bank orders pass through several hands within a bank and any bank slip normally includes the client’s name and address, but a numbered account avoids these risks.
It’s a protection which comes at a price, as Nason explained: the administrative procedures are more complicated, and as a consequence the costs are higher.
So most of us will never be any the wiser about them.
Nicole della Pietra, swissinfo.ch (adapted from French by Julia Slater)
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Tom, Switzerland
Interesting subject but the reality is that politicians do not walk the talk and want taxes. They wish to be seen to be the law maker and guardian of results to claim the win. However the real question is why should anyone (public citizen) have a tax advantage over another one in normal circumstances by tax avoidance which is illegal. Legal tax planning is legal but not avoidance. And if you follow the UBS story you will see it is avoidance the US goverment is after and wish the people doing it pay the price which is fine. You take the risk then you take the pain if cought with tax avoidance in that goverments statute. However Switzerland can not tell the US goverment to go away if its US citzens are doing tax avoidance and we have seen cow like submissions for other reasons.
Farha, India
What John says is true. It is a wonder that Switzerland doesn't insist upon the same rules being applied to it from the US government!
John, United States
When a Nevada bank is asked by the government who the owner of a numbered account is, the bank can honestly say they do not know (and the owner of the account has NOT committed fraud, unlike in switzerland). During economic crises in Mexico Mexican government officials actually have gone to Texas banks and demanded the names of Mexicans with accounts in the bank. The information was not provided and the Mexicans knew it would not be since they themselves had money placed secretly in those very banks. Cool. Bring your money to the US. If you are not a US resident or US citizen, then put your money in a US bank, especially in Nevada or Delaware, and pay no US tax on your interest and your money and earnings will not be reported to your home country. In fact, in nevada you can have a secret numbered account at a bank with the bank not knowing your identity that is not fraud in Nevada. So, send your money to the US!! There is a reason that Miami is the main banking center for all of Latin America.
Nicholas , Switzerland
Odette: this picking on Switzerland will end when Switzerland stops abetting crime and criminals. Ra: you say "Basically what banking secrecy does is prevent swiss banks from giving active assistance to foreign regimes in convicting their people." What you really mean is "Basically what banking secrecy does is prevent swiss banks from helping foreign governments convict criminals." Foreign courts have laws on divorces - and any number of other important matters - which are decided under democratic systems. what gives Swiss banks the right to violate those democratic systems?
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Numbered accounts
A numbered account can consist of a name, a number or a combination of both.
The beneficiary is not anonymous, but only a very limited number of people have access to the details.
To meet strict confidentiality rules, certain precautions are obligatory:
Bank statements must be sent to a postbox, or to a legal representative of the account holder.
There is no cheque book, credit cards or other means of transferring funds: they leave too many traces.
Any payment into the account by a third party must be formally authorised.
Bankers advise clients to avoid accessing their account over the internet, because of security concerns.
The same applies to the telephone; clients are advised to use public call boxes.
Swiss banks and secrecy
Swiss banking secrecy has existed since 1934.
Switzerland is not the only country with numbered bank accounts. They are also available in such places as Austria, Luxembourg, Monaco and Lichtenstein.
A number of websites offer advice to expatriates about opening an account in Switzerland. Some require minimum deposits of hundreds of thousands of francs.
Banks say clients should come to them directly if at all possible.
