UBS chairman denies tax evasion claims

UBS Chair Axel Weber has defended the bank Mario Vedder/dapd

Axel Weber, the chairman of the board of UBS, has denied the latest allegations that the bank helps its clients evade taxes. Weber made the comments in an interview with Germany’s Handelsblatt newspaper on Friday.

This content was published on August 17, 2012 - 12:03
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“UBS does not help any of its clients avoid their tax obligations,” Weber said. “Anyone in violation will be severely sanctioned,” he added. “I have zero tolerance on this point.”

The interview follows recent allegations that UBS employees were aiding their clients in transferring funds out of Swiss banks and into accounts in Asia in order to avoid taxation.

Weber also asserted that the bank is not undermining a tax deal between Switzerland and Germany, but in fact supports it. “It is the right way to finally draw a line through the past,” he told the paper.

The bilateral tax agreement would provide for the assessment of a one-time charge of 21 to 41 per cent of the value of German assets in Swiss banks, but would not require the owners of the accounts to be identified. It has been ratified by the Swiss parliament but will not be voted on by the German parliament until the autumn.

Opposition to treaty

There is opposition to the treaty in both countries. In Switzerland, both the centre-left Social Democrats and the rightwing Swiss People’s Party are gathering signatures in order to hold a referendum on the accord in November.

In Germany, there is uncertainty over whether the proposed law will be ratified. A number of German states headed by parties which do not support German Chancellor Angela Merkel have criticised the agreement. The SPD, one of those, has a majority in the German parliament.

German critics of the treaty question the fairness of imposing a lower tax on foreign assets than on those held in German banks, and stress that it will make it harder for German authorities to prosecute tax evaders.

In particular, North Rhine-Westphalia’s finance minister Norbert Walter-Borjans has defended the state’s right to continue purchasing stolen CD’s containing the names of German citizens who have reputedly tried to avoid paying German taxes by stashing their funds in Swiss banks.

Swiss Finance Minister Eveline Widmer-Schlumpf had stressed in July that the new tax agreement prohibits the active purchase of such CDs.

Libor scandal

Weber also told the Handelsblatt that UBS is not currently in settlement talks with United States authorities over the Libor interest rate manipulation scandal.

“UBS was the first bank to go to the authorities when we had grounds for suspicion in 2010. As a result, we received conditional immunity, meaning we are a key witness,” Weber said.

Weber’s interview with the Handelsblatt was his first major interview with a German newspaper since he took over UBS in May. The UBS chairman was formerly president of Germany’s central bank, the Bundesbank.

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