The Swiss banking industry is slowly but surely abandoning its legacy of guarding the secrecy of customer accounts.
As many as 40 of the country's approximately 300 banks have said they would voluntarily turn over client information to the U.S. Department of Justice in return for immunity from prosecution for helping Americans evade taxes, reports USA Today
The Justice Department set a deadline of Dec. 31 for the banks to take deals protecting them from prosecution in exchange for handing out Americans' account information.
"What's really clear is that this [Justice] program is at the limit of what is tolerable for banks in Switzerland," Sindy Schmiegel of the Swiss Bankers Association in Basel told the newspaper.
The effort is part of a government crackdown on tax evaders and overseas banks that heated up in 2009 after UBS, Switzerland's biggest bank, agreed to a $780 million settlement for concealing identities and assets from the IRS.
The Justice Department is currently investigating 14 major Swiss financial institutions, including Credit Suisse, Julius Baer, and the Swiss arm of HSBC, for shielding U.S. tax evaders, and many leading banks that are not yet being probed have been urging wealthy clients to turn themselves in to the tax man, Politico reported
"The banks have every incentive to shove their American clients into compliance in order to reduce the penalties," tax attorney Jeff Neiman, who prosecuted UBS for the U.S. government, told the publication.
Politico cited three letters from Swiss banks to U.S. clients urging them to come clean.
"Your account information may be subject to a treaty request from the United States to the Swiss Federal Tax Administration, which may result in your account information being turned over to the DOJ or IRS," warned one letter sent by Corner Bank.
Meanwhile, the World Economic Forum taking place this week at Davos, Switzerland, will reportedly hold a forum dedicated to how the country's banking industry can reinvent itself in the absence of banking secrecy.
"Swiss bankers accept that they are living in a new reality," Bruno Patusi, head of wealth and asset management at Zurich-based financial services firm EY, told USA Today.
"But we will only see a change in certain areas. Confidentiality is still extremely important. It is true that we are seeing assets flow out [of Switzerland], but that's partly because the next generation is more interested in spending than saving."
© 2016 Newsmax. All rights reserved.