US Charges Swiss Bank with Enabling Tax Fraud (UBS)

The US Department of Justice has indicted Switzerland’s oldest private bank, Wegelin founded in 1741, with fraud and conspiracy for enabling US customers to hide at least $1.2 billion in deposits from US taxation. This is the first such prosecution in US history.

Wegelin, which operates only in Switzerland, used UBS AG (NYSE: UBS) as its correspondent bank. The US DoJ seized $16 million from UBS in a separate civil forfeiture case according to a report from Reuters.

There are 10 other banks being investigated by the DoJ on similar charges that threaten to strike down the long-held tradition of secrecy accorded to Swiss banks.