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Swiss Banks Making Concessions On Secrecy

kdawson posted more than 5 years ago | from the next-stop-panama dept.

Government 325

Aryabhata writes in with news that should chill the hearts of evil dictators and tax cheats everywhere: one of the last bastions of strong banking secrecy, Switzerland, is bowing to international pressure and agreeing to cooperate with some foreign investigations of wrongdoing. "...the Swiss government announced on Friday that it would cooperate in international tax investigations, breaking with its long-standing tradition of protecting wealthy foreigners accused of hiding billions of dollars. Austria and Luxembourg also said they would help. ... The famed 'numbered accounts' that do not bear the owner's name will still be available for clients willing to pay for added anonymity. ... Over the past month, leaders have made similar promises in Singapore, Liechtenstein, Bermuda, the British islands of Jersey and Guernsey, and tiny Andorra... other 'offshore' banking centers are still available in the Caribbean, Panama, Dubai and elsewhere."

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and who ISN'T going to pay up? (4, Insightful)

v1 (525388) | more than 5 years ago | (#27201425)

The famed 'numbered accounts' that do not bear the owner's name will still be available for clients willing to pay for added anonymity

Anyone that needs one of those accounts is going to be willing to pay that added fee. So besides the Swiss making a little more money off their money hiding, what changes?

Re:and who ISN'T going to pay up? (3, Funny)

SupremoMan (912191) | more than 5 years ago | (#27201447)

Let me check for you. *looks outside* Nope the sky is still blue, so nothing has changed.

Re:and who ISN'T going to pay up? (0)

Anonymous Coward | more than 5 years ago | (#27201567)

It is all about competition and competition between States (in the US) and States/Countries in the rest of the world. This includes competition between tax and regulation systems, giving people the freedom to go where they will.

The poster well below is right, it is yet another step toward a world government.

Re:and who ISN'T going to pay up? (3, Insightful)

garett_spencley (193892) | more than 5 years ago | (#27201675)

Or anyone who, out of principle, doesn't like the idea of having authorities snooping on their economic lives at their will.

Honestly, "Aryabhata writes in with news that should chill the hearts of evil dictators and tax cheats everywhere" comes across as a little ironic to me, when considering that the mere concept of enabling authorities to snoop on the financial lives of people at it's will is right up the alley of dictatorial and authoritarian. What ever happened to freedom, the right to privacy, search warrants, due process and innocent until proven guilty ?

Re:and who ISN'T going to pay up? (3, Informative)

The Dancing Panda (1321121) | more than 5 years ago | (#27201697)

The Swiss Banks didn't respond to search warrants. That's what they're going to cooperate with in some cases from now on.

Re:and who ISN'T going to pay up? (4, Informative)

Anonymous Coward | more than 5 years ago | (#27202033)

The Swiss Banks didn't respond to search warrants. That's what they're going to cooperate with in some cases from now on.

The Swiss banks have always responded to search warrants issued by a Swiss court for things that are serious crimes in Switzerland (drug dealing, terrorism, money laundering, etc).

HOWEVER, tax evasion is not a crime in Switzerland. Which is one reason Swiss banks are so popular.

Re:and who ISN'T going to pay up? (4, Interesting)

fugue (4373) | more than 5 years ago | (#27202123)

If "due process" becomes the same sort of joke internationally that it is in the USA (and elsewhere) (border laptop confiscations, random car searches and paper checks, warrantless wiretapping, surveillance face recognition, ...), then it seems reasonable that people will (1) legitimately stop paying taxes to a government that has broken its end of the contract (eg. the Constitution in the USA), and (2) look for large and powerful entities that will actually respect their contracts. If banks have their own fair and reasonable judicial system, it's no less sad that governments don't, but at least someone powerful does. At least for now...

Yes, I've just painted a scenario in which the police go to the bank and demand a client's records, the bank says "let's see your evidence", and the bank decides whether or not there is enough evidence to warrant allowing an investigation. I realise that that is not what is going on in this case. But it's interesting to think about.

War, security, health care, clean water, etc., are all being privatised. Why not justice?

Re:and who ISN'T going to pay up? (1)

kalirion (728907) | more than 5 years ago | (#27201713)

What ever happened to freedom, the right to privacy, search warrants, due process and innocent until proven guilty ?

However if there is an applicable search warrant, the authorities should be able to gain access to all of that specific person's accounts.

Re:and who ISN'T going to pay up? (1, Insightful)

OeLeWaPpErKe (412765) | more than 5 years ago | (#27201803)

That depends on who issued it. Otherwise you'll find yourself under investigation with a warrant coming from dubai because you stated on your blog that women and men have equal rights or some other such clearly anti-islamic "racist" bullshit. (anti-islamic obviously does not belong withing quotation marks since equality IS against islam, it is also the opposite of racist ... that can only mean that islam is in fact ... but that's too much truth for any government to handle)

Re:and who ISN'T going to pay up? (1, Insightful)

Cryolithic (563545) | more than 5 years ago | (#27202315)

I'm going to assume you're a standard "God fearing christian", as you decided to single out islam rather than point out that the majority of religions are against equlity. Read your bible, there's lots of examples the promote inequality.

Re:and who ISN'T going to pay up? (0)

Anonymous Coward | more than 5 years ago | (#27202367)

And guess what? We have agreements with U.S. and a whole lot of other countries to assist in cases of suspected fraud.

The summary is overly sensationalist, we also have a constitutional state, after all. The only thing upsetting the other countries is the distinction between tax evasion and tax fraud. Because only in case of tax fraud (= fradulent falsification) are the banks required to hand over the information of the account holder. The agreement with the U.S. was already spongy enough to bend our law a little bit to justifiy the recent information handover.

Thus, what's probably going to happen is the following: We'll agree to not make the distinction between tax evasion and fraud when it comes to foreigners, but we'll still keep the bank secret for ourselves.

Because we like being innocent until proven guilty.

Re:and who ISN'T going to pay up? (5, Insightful)

dbcad7 (771464) | more than 5 years ago | (#27201753)

And yet.. if you were trying to find out where 60 some odd billion dollars that some guy stole from peoples retirement accounts has gone to.. the high road just doesn't sound all that righteous..

Re:and who ISN'T going to pay up? (4, Insightful)

garett_spencley (193892) | more than 5 years ago | (#27201951)

First off, I didn't realize that the banks were not honoring search warrants. My bad, I should have RTFA'd and I appreciate people informing me and not flaming me. Now I know better.

However, what you are describing is mob-mentality and is what leads us down the road to an authoritarian and totalitarian system. I fear that Bernie Madoff is going to be used by the authority to increase it's grip over people's lives just as they do every other "catastrophe". We need to keep things in perspective. We have due process for a reason: to preserve the individual's freedom. People who screw with the system and disrupt the social order do need to be dealt with, but if we do not limit the authority's power then we all lose, rather than gain.

This is the exact same attitude that lead to blatant violations of civil rights after 9/11. People were saying "And yet ... when people get into planes and fly them into buildings killing thousands of innocent people ... the high road just doesn't sound all that righteous".

I would rather let a few bad guys get away, and make the ones that we catch compensate society for their loss (by paying back what they stole, not by taking away their freedom ... unless we're talking about violent offenders of course) than give big brother the ability, potential and incentive to control us.

Re:and who ISN'T going to pay up? (1)

Watson Ladd (955755) | more than 5 years ago | (#27202143)

The issue is that legal search warrants weren't being honored.

Re:and who ISN'T going to pay up? (1)

fugue (4373) | more than 5 years ago | (#27202205)

Well put.

I'd go a step further. Crime should be likely to hurt you: (what you stand to gain) * (your chance of getting away with it) should be significantly less than (what you stand to lose if you get caught) * (your probability of getting caught). If you just paid back what you gained, you'd be a fool not to commit crimes.

Re:and who ISN'T going to pay up? (1)

garett_spencley (193892) | more than 5 years ago | (#27202243)

How about, if you're found guilty you also have to pay back all of the public's expenses used to investigate, prosecute and put you on trial ?

Re:and who ISN'T going to pay up? (1)

theillien (984847) | more than 5 years ago | (#27202283)

I would rather let a few bad guys get away, and make the ones that we catch compensate society for their loss (by paying back what they stole, not by taking away their freedom ... unless we're talking about violent offenders of course) than give big brother the ability, potential and incentive to control us.

What do you do when the means to make repayment aren't there? In the case of Madoff, even if (hopefully when) they seize all the assets under his wife's name it won't be near enough to pay back everything lost by those who trusted him. Taking away his freedom is the only other logical compensation.

Re:and who ISN'T going to pay up? (0)

Anonymous Coward | more than 5 years ago | (#27201971)

The Swiss have the most restrictive money laundering laws in Europe. And it wouldn't be the first time a former dictator finds out that his accounts were frozen. The Swiss don't consider tax evasion a crime, but for anyting worse they'll happily give away your data. Secrecy isn't there to protect criminals.

Re:and who ISN'T going to pay up? (1)

maxume (22995) | more than 5 years ago | (#27202247)

Give it a few years before you decide that he really managed to steal $60 billion. At this point, it isn't clear if that is the amount of money that he received, or if it is the amount that he was telling people that he had under management. Given that he was claiming 8% and better returns for almost twenty years, it is at least possible that he only managed to evaporate $30 billion (which is still evil and galling, but it also means that they aren't going to find more than that...).

Re:and who ISN'T going to pay up? (4, Insightful)

Patch86 (1465427) | more than 5 years ago | (#27201811)

All the Swiss (and other governments) are planning on doing is co-operating with criminal investigations, which until now they've refused to do. You'll still need warrants, court orders and all the other trappings of due process before they'll co-operate.

Like it or not, if you live/work in a country, you need to pay taxes there. And if you steal money in a country, you need to give it back. Anything that allows people to dodge taxes and profit from crimes is a bad thing, full stop.

Re:and who ISN'T going to pay up? (3, Informative)

Corbets (169101) | more than 5 years ago | (#27201875)

Like it or not, if you live/work in a country, you need to pay taxes there.

And as Americans, we get to pay taxes even if we don't live or work in the country too! Hooray!

Re:and who ISN'T going to pay up? (1, Insightful)

Colin Smith (2679) | more than 5 years ago | (#27202215)

Anything that allows people to dodge taxes and profit from crimes is a bad thing, full stop.

Freedom.

 

Re:and who ISN'T going to pay up? (5, Informative)

olesk (211973) | more than 5 years ago | (#27201737)

Numbered accounts do not exist - they are a James Bond myth. What we (I'm a Swiss banker) refer to as "numbered accounts" are accounts where the name of the account holder is not references in correspondence with he bank. The idea of accessing your account with only a number is a joke, considering that the Swiss have one of the strictest identification policies for opening and managing accounts in Europe (and thus probably the world). You not only need to ID yourself, but also prove where the money come from to the bank. (Certain countries have poor documentation standards for just about anything, and getting an account if you're from one of those is very very hard. You'd get it in Germany though, where they are more lax on their documentation (as is France), which is a little ironic...).

Re:and who ISN'T going to pay up? (1, Troll)

DNS-and-BIND (461968) | more than 5 years ago | (#27202149)

As as Swiss banker, I'd like to ask you how you feel about contributing to the impoverishment of Africa by providing a means for governments to untracably steal taxes and foreign aid money from their people.

Re:and who ISN'T going to pay up? (0)

Anonymous Coward | more than 5 years ago | (#27202373)

I know *I* don't care.

Re:and who ISN'T going to pay up? (1)

adamchou (993073) | more than 5 years ago | (#27201747)

If the article would have been properly summarize the article, you would know. Here's the entire paragraph...

The famed "numbered accounts" that do not bear the owner's name will still be available for clients willing to pay for added anonymity. But the government will now be able to demand account holders' identities in cases of suspected wrongdoing and share that information with foreign authorities.

Re:and who ISN'T going to pay up? (3, Informative)

phantomfive (622387) | more than 5 years ago | (#27202025)

It's ok, according to Misha Glenny, [randomhouse.com] Dubai has taken the place of Switzerland as the preferred place for illicit money storage. In his book, he gives an example where a guy tried to transfer $3000 from a bank in Dubai, and they made him fill out a form. Very good record keeping. Except when he wanted to transfer $2 million euros, he did without any problem. He says, "If they ask too many questions, they won't get sales!"

Dubai of course isn't the only place, there are others, like Lichtenstein, and (at least in the 90s if you were Jewish) Israel. These are popular places for organized crime organizations to launder money. He says, "The only credible reasons for their growth and success is the fact that many corporations in the licit economy use them for the exact same reasons [as the criminals] (especially tax evasion). The government of the United States could force them to lift their banking secrecy codes overnight if they threatened to apply the same sanctions on offshore centers that they do on the onshore banks.......Without offshore banks it would not be only the mobsters finding it onerous to shuffle their money and companies around. Enron would have found it a lot harder too........"

Getting banks to be more open is a good thing in many ways.

Hardly a suprise (2, Insightful)

geniice (1336589) | more than 5 years ago | (#27201429)

Hardly a suprise. Tax havens can be overlooked when times are good. Less so now. If the situation of somalia continues I can see some reform of the ship flagging system also takeing place.

Re:Hardly a suprise (-1, Offtopic)

Anonymous Coward | more than 5 years ago | (#27201825)

I bet most of the "numbered" accounts will belong to rich liberals, at least those that didn't get taken in the Madoff scam.

They have to pay their fair share, right?

Stop the Presses... (4, Insightful)

retech (1228598) | more than 5 years ago | (#27201459)

Evil Dictators got caught doing wrong... (stop).

Last bastion of free money compromised... (stop).

Secret stash not so secret... (stop).

Mugsy and Lefty may be on the take... (stop).

Slashdot editor KDawson sensationalizes yet another tired story... (stop).

Re:Stop the Presses... (2, Insightful)

hamisht (197412) | more than 5 years ago | (#27202249)

Evil Dictators got caught doing wrong... (stop). Last bastion of free money compromised... (stop). Secret stash not so secret... (stop). Mugsy and Lefty may be on the take... (stop). Slashdot editor KDawson sensationalizes yet another tired story... (stop).

KDawson please just... (stop)

Tax Cheats? (4, Insightful)

anagama (611277) | more than 5 years ago | (#27201485)

Like cheating an inept and corrupt government is wrong somehow.

Re:Tax Cheats? (5, Insightful)

T Murphy (1054674) | more than 5 years ago | (#27201519)

Like cheating an inept and corrupt government is wrong somehow.

If you consider that true, then considering how a perfect government is never going to happen, that would imply taxes should never be paid.
So much for civilization.

Re:Tax Cheats? (4, Interesting)

Anonymous Coward | more than 5 years ago | (#27201591)

Remind me again what minimal government in a rational society attempted a system of voluntary taxation but failed completely.

Oh, that's right, it hasn't happened yet, because governments invariably end up being bloated and unpopular, so must force people to pay taxes at the point of a gun. And it all works because of a vast cadre of useful idiots like yourself, the disciples of authoritarianism.

Nothing that has been achieved could not be achieved with a smaller government to which productive citizens willingly pay for service. Indeed, I spent a lot of time pretty much entirely avoiding paying tax, but willingly give to charities (neither political nor religious!), foundations, veteran/law enforcement benevolent funds, etc. I care about those who protect me and those who are weaker than me, but I hate you because you want to make me your slave.

Fortunately, I've probably got enough wealth behind me that I can use accountants, lawyers and friends in the right places to keep me going as I am. I'm sad that I can't help even more people, rich and poor, to go through life as I do.

Re:Tax Cheats? (1)

T Murphy (1054674) | more than 5 years ago | (#27202163)

In the end you're relying on everyone to not be selfish and cheat the system. The only way to stop that is to enforce taxes. If you think charities are the solution, why is there still so much poverty and starvation? They can only cover a small part of the problem they hope to solve because voluntary donations will never be enough. You say there will be enough donations if we don't have taxes? Tax money doesn't disappear, someone gets it. That means those people aren't donating enough, and somehow they will once you streamline the government? I agree with your sentiment, but I see no room for such an idea in reality.

Re:Tax Cheats? (0)

Anonymous Coward | more than 5 years ago | (#27202181)

Nothing that has been achieved could not be achieved with a smaller government to which productive citizens willingly pay for service.

Nice to know there are still idealists around, even if their idealism makes them into assholes.

Re:Tax Cheats? (-1, Flamebait)

Anonymous Coward | more than 5 years ago | (#27201603)

And what's wrong with that, exactly?

Why can't I just pay for the government services I actually use, like the roads and water?

Why do I have to pay for some poor schmuck who decided to get a loan that he couldn't afford to buy a house he couldn't afford? Why should I have to pay to help some city somewhere build a useless tunnel to replace a perfectly functional, but "ugly," road? Why should I pay for someone to sit around and do nothing all day, because they failed to save for the possibility that their employer might be forced to cut their job?

The "withholding" system used in the US is brilliant, because almost no one actually realizes just how much money the government is taking from them. To compound this, the government actually takes MORE THAN YOU REALLY OWE off each paycheck, and then gives it back once a year. And people are GRATEFUL for this!!

Now I know someone is going to come up with a long list of "important services" but what they forget is that with more money available to people, charitable giving will be up, and far more efficient and effective charities can replace the useless government institutions that they list.

Re:Tax Cheats? (1)

iminplaya (723125) | more than 5 years ago | (#27201769)

The end of corrupt civilization is bad thing? Is corruption some how better than anarchy? In most parts "civilized" is pretty one sided. Yep, we sure are a real civilized bunch [reuters.com] . To mangle the phrase: With civilizations like this, who needs chaos?

Re:Tax Cheats? (1)

Watson Ladd (955755) | more than 5 years ago | (#27202159)

Ever hear of the dark ages? Do you know why they were called dark? Bandits behind every tree, commerce choked by fear, and a miserable short existence for the vast majority of people. That's what anarchy looks like.

Re:Tax Cheats? (1)

iminplaya (723125) | more than 5 years ago | (#27202277)

And what we have now is anarchy for some and "miniature flags for others". All very nice when the gun is pointed the other way.

Re:Tax Cheats? (2, Insightful)

theillien (984847) | more than 5 years ago | (#27202349)

While I don't disagree with your assessment of what it was like back then, I would argue that we call them the Dark Ages more because of the stifling nature of the Church which prevented any significant and beneficial progress.

Re:Tax Cheats? (3, Interesting)

darjen (879890) | more than 5 years ago | (#27201913)

So taxation is necessary for civilization? Pretty big assumption if you ask me.

Re:Tax Cheats? (2, Insightful)

T Murphy (1054674) | more than 5 years ago | (#27202405)

People will pay for civilization out of good will? Pretty big assumption if you ask me. (As another post points out, paying only for what you need is like not buying insurance- I'm willing to pay a hefty premium if it gets me civilization).

Re:Tax Cheats? (1, Insightful)

sakdoctor (1087155) | more than 5 years ago | (#27201617)

Who the hell are we (US/UK/wherever) to say that we are "losing" tax revenue because of tax havens?
That's more stupid than when the RIAA calculate their "losses" from piracy.

Sometimes people need an opt-out from the retardation and danger of run-away collectivism.

Re:Tax Cheats? (1)

dinther (738910) | more than 5 years ago | (#27201651)

Gimme a hug. A voice of reason is so rare these days

Re:Tax Cheats? (-1)

Anonymous Coward | more than 5 years ago | (#27201623)

Like cheating *any* government is wrong somehow .. taxation is theft. Always has been, always will be. Just in modern times the King doesn't send goons to count your chickens, the President/PM/wtf ever twists your employers arm so you never see the money in the first place. Vastly more efficient tyranny that way.

Re:Tax Cheats? (1)

tchuladdiass (174342) | more than 5 years ago | (#27201853)

But the payroll withholding ends up being a tax on your employer. Because when you negotiate your salary, you do so knowing that a big chunk is taken out in taxes. So if you want to make $3000 a month, you ask for $4500. But if you didn't have any taxes coming out, then your employer would probably be able to talk you down to paying $3000 a month, and you would be happy (otherwise, there would be enough other people willing to do that job for that price).

I'd actually like to see a good comparison between different modern systems where taxes are taken out before you get your money, vs. taxes collected in some other manner (not based off income). Then compare the typical income for particular jobs to the price of goods & services.

Re:Tax Cheats? (3, Insightful)

SwedishPenguin (1035756) | more than 5 years ago | (#27201687)

I guess you can do without public roads, you'll just build your own?
If you get permanently disabled somehow and can no longer work for a living, I assume you'll have enough savings to last a lifetime?
You can also pay for your kids school? Health care?
I assume you'll extinguish any fires, or at least have several thousand at hand when it happens to pay off the local firefighting company?
And you'll catch criminals on your own, or maybe you'll pay the private cops thousands to catch that criminal that stole a computer worth $500?
Oh and can I assume that don't care one bit what happens to those who cannot pay for all this on their own (ie. at least 50% of the population)?

Re:Tax Cheats? (0)

LCookie (685814) | more than 5 years ago | (#27201779)

Oh and can I assume that don't care one bit what happens to those who cannot pay for all this on their own (ie. at least 50% of the population)?

Actually I don't. It's called survival of the fittest. It's only the damn humanitarians that think every life is "sacred" and needs to be protected as opposed to nature. Why should I need to pay to keep somebody else alive?

Re:Tax Cheats? (2, Insightful)

Anonymous Coward | more than 5 years ago | (#27201845)

"Survival of the fittest" often means the most violent, least caring people will win. So you're happy with a society run by thugs and psychos for their own benefit?

Re:Tax Cheats? (1)

LCookie (685814) | more than 5 years ago | (#27201987)

Which would be different from what we have now in how far?

Re:Tax Cheats? (0)

Anonymous Coward | more than 5 years ago | (#27202251)

In that you, sitting behind a computer talking about this, would be culled in the first wave, whereas now, you're allowed to live?

Re:Tax Cheats? (1)

Dramacrat (1052126) | more than 5 years ago | (#27202423)

Sure beats an ineffectual and hypocritical reptile/monkey/liar in a suit.

Re:Tax Cheats? (2, Insightful)

ardor (673957) | more than 5 years ago | (#27201871)

Unlike animals, we are not necessarily bound to our instincts. We do not have to slavishly follow the "survival of the fittest" path. A "survival of the fittest" society is a dystopia.

Re:Tax Cheats? (0)

Anonymous Coward | more than 5 years ago | (#27201879)

Actually I don't. It's called survival of the fittest...

You really want to go back to the wild west, steppin' through all that horseshit? Man, that would suck to fall face first in a gunfight.

Re:Tax Cheats? (4, Interesting)

garett_spencley (193892) | more than 5 years ago | (#27201837)

Brace yourself, you're in for a real shocker. The USA did not have an income tax prior to 1913 ! *gasp*

The only role I see for government in a free society is preserving freedom. The courts and the police do need to exist in order to deal with those members who would inflict harm upon others, and to act as an arbitrator, when requested, to settle contract disputes. Everything else, you do not need a government to private... and you do not need an income tax to pay for the judiciary.

"I guess you can do without public roads, you'll just build your own?"

All over the US there are private roads and people voluntarily pay tolls to travel them because, brace yourself again, they provide a much more pleasant commute. They deal with traffic congestion immediately, they undertake repairs and maintenance quickly and effectively, without bloated government bureaucracy making repairs and improvements take years and cost tax payers millions of dollars and they do it with their own money.

"You can also pay for your kids school? Health care?"

Government involvement in those two institutions has railroaded both of them straight into the ground. In Canada, for example, there is no law preventing private schools from operating but they're virtually unheard of because everyone is forced to pay taxes to send other people's kids to public school. If government got out of the school system entirely you would have lots of schools opening and competing with each other, forcing prices down. It would be in every school's best interest to increase enrollment and student loans with reasonable, market-determined interest rates would become common for poor students. The level of charity would increase as well. As far as health care is concerned, you should listen to some of what Ron Paul has to say. He was a practicing obstetrician long before he entered politics, and long before medicaid, medicare and government got it's hands on the system. According to him charities and churches would build hospitals and even in the private for-profit hospitals no one was ever turned away because they couldn't afford to pay. It's precisely because we are taxed and regulated so much that these things get so expensive to begin with.

"If you get permanently disabled somehow and can no longer work for a living, I assume you'll have enough savings to last a lifetime?"

Again, if people are allowed to keep what they work for, and if government does not try to interfere with who people trade with and how and why and under what circumstances the economy prospers, people have a lot more personal wealth and charities become much more common. Insurance will also still exist. This goes straight back to medical care. No one will bother to take out insurance plans to cover the occasional doctor's visit, but insurance will still exist to cover extreme unforeseen chronic illness. Employer-provided benefits would also still exist as a way to compete with other businesses for labour and attract employees. As long as it's optional and not mandated by "pro-labour" government regulation it's a boon to society and not a hindrance.

"Oh and can I assume that don't care one bit what happens to those who cannot pay for all this on their own (ie. at least 50% of the population)?"

I urge you to read a bit on economics. Read up on the work of Ludwig Von Mises, F.A Hayek, Murray M. Rothbard and start to ask yourself WHY there is so much poverty. The answer is almost always institutional. During the 1800's the USA economy grew at a tremendous rate. The country was seen as the land of opportunity where you could make it with a bit of hard work. Gradually the government started to expand and intervene with programs sold to the public as a way to help overcome the problems that they perceived in the system. Problems which are all relative. If you compare today's standard of living with that of 1700 England under Serfdom, or even 1930 in Russia and Germany under socialism, you realize just how much the free market has raised production, and consequently the standards of living of the average individual. The more government tries to interfere the more unemployment and poverty they create. Taxes are a big part of this but there's lots of other harm that government does too, that people are told is actually helping them. Trade barriers, mandatory licensing, turning a blind eye when labour unions use violence and coercion, minimum wage laws etc. all create institutional unemployment and poverty.

Re:Tax Cheats? (3, Insightful)

Totenglocke (1291680) | more than 5 years ago | (#27202061)

Very good points. Too bad most people are so brainwashed into thinking we need the government controlling everything and will call your post "anarchist propaganda" or something along those lines. The fact remains, most of the time the government causes more harm than good.

Like you? (0)

Anonymous Coward | more than 5 years ago | (#27202291)

I have two words for you: yeah, right.

You can't have a government without taxes. Period. (Granted, they don't have to be income taxes, but there does have to be some kind of tax.)

And I note that you want to credit capitalism for everything. Strangely, I remember quite a few ways they regulated business to make things better. You know, after trust busting to get rid of those companies that had, in essence, their own private armies. Or their own colonies that were, in effect, wage slaves (you had to get all your supplies from the company store... guess where your paycheck went back to?).

So no, I don't think of progressive taxation as evil. If anything, reading what you wrote makes me want to vote for a tax increase.

Re:Tax Cheats? (5, Insightful)

SerpentMage (13390) | more than 5 years ago | (#27202443)

Dude what have you been smoking?

First let's tackle health care shall we...

Health care in private does not work because it is upside down economics. It is not like getting car insurance because for the most part you can avoid getting into an accident. BUT when you get old you cannot avoid cancer or a whole host of diseases that will afflict you.

This means when you are young you should actually pay more in insurance so that you are covered for the future. But health insurance is priced like car insurance and thus as you get sick you end up paying more. It is wrong!

When Ron Paul and such talk they talk CRAP, yes you read that right CRAP. They talk about breaking a leg, giving birth, etc. They are not talking about chronic diseases, which are actually the core of our health care dilemna. We have people who should have kissed their lives goodbye still living. And that COSTS A WHOLE HEAPING LOAD OF MONEY!

So if you are going to talk private I say make youngsters pay more when they are healthy than when they are old.

Oh yeah that will not work since we tend to be people who only react when they are having problems.

Let me give you a secret, do some research on Bismarck the state leader. He introduced concept of health care, and pensions. He did so to pacify the people. But he did so with a very high bar because he knew that health care and pensions can suck a government dry.

The true cost of health care, pensions and society can only be borne by the populace as a whole. Do the math and you will see there is no other solution.

Well there is a solution, those that have the money get it, those that don't die...

Re:Tax Cheats? (0)

Anonymous Coward | more than 5 years ago | (#27201881)

I shall only deal with one of your points. Roads.

So as things stand now, the government paves the roads .. oh .. no .. wait. The government pays private firms at lowest bid to pave the roads.

So the government doesn't pave the roads. Private firms do.

Hunh. Well, at least they're paid for by government money. Thats a comfort.

Oh, wait .. the government doesn't HAVE money of its own. It needs to take that money from us. So it's stolen private money, paid to private businesses, which get the roads paved at the end of the day.

Tell me, exactly, how we need government to pay for our roads when they're getting the money to do it from us, anyway?

Re:Tax Cheats? (0)

Anonymous Coward | more than 5 years ago | (#27201919)

I'm not going to pick through your list, because I agree that some of them are good candidates, for the responsibilities of a minimal government.

From your attempt to paint anyone who doesn't agree with you as selfish, I name you collectivist, regardless of the other political and philosophical -isms you've aligned yourself with.
Can't speak for everyone but I think the selfishness you see, is actually people wanting to claim more responsibilities, and naturally they want others to take greater responsibility, so that we can all enjoy maximum rights and freedoms in our lives.

You seem more than willing to take the scraps left over, after much of the wealth has been destroyed in the bureaucracy needed to extract it. Well why would you, it was stolen from someone else.

I don't blame governments for anything. I blame you.

Re:Tax Cheats? (0, Flamebait)

darjen (879890) | more than 5 years ago | (#27202081)

I guess people wouldn't want to build roads unless they're forced to by the government (who does a terrible job of maintaing roads anyway)

Nobody would help out the permanently disabled without the government (who does a terrible of it)

Nobody would be able to teach their kids school or pay for health card without the government (who does a terrible job at both of those)

Nobody would want to extinguish any fires without the government (who does a terrible job of it)

Nobody would want to catch criminals without the government (how often does your local law public law enforcement catch them?)

And finally, nobody would care about people who can't help themselves without the government.

In summary... the government does a terrible job at all the things you mention, and assuming none of them would be available wihtout the government is ridiculous and intellectually lazy.

Re:Tax Cheats? (1)

SerpentMage (13390) | more than 5 years ago | (#27202463)

Speak for yourself buddy! Because these things are dysfunctional in YOUR country does not mean that they are dysfunctional in other countries!

Re:Tax Cheats? (1)

Totenglocke (1291680) | more than 5 years ago | (#27202211)

Roads are one place where it normally is more useful for the government to deal with it, but that is a rare case!"

As for disability, why should the fact that something bad happened to you mean everyone else should be punished? Do you really think you are so important that if you could no longer work (and therefore not make money, assuming you're living alone with no family) that the rest of the population should pay you to sit at home and do nothing? That is a terrible waste of money and a huge burden to society.

School and health care are similar. Why should others be forced to pay for you to have a better life just because you failed to build a life where you could afford those things. While government run schools are crap, I can at least understand having SOME government schools for the extremely poor since an education is important in the modern world.

As for Police and Fire fighters, yes, again, those are some of the few times when it's better to have the government run things. Actually though, fire fighters it probably WOULD be more useful if you just paid a bill after you had a fire -- honestly, how many homes have you ever seen on fire in real life? I've never seen one and it does seem kind of stupid to pay for it every week for your whole life when odds are you'll never need it.

As for caring about what happens to those who can't pay? Sure, it sucks, but again I say why should everyone else be punished because some made bad choices (or in rare cases in normal economic times had bad luck)? Just because your life isn't as good as you want it to be doesn't mean everyone else in the country should be punished for it.

And if you elect them? (1)

Kupfernigk (1190345) | more than 5 years ago | (#27201929)

Seing as how most of the people and corporations who use these tax havens also expect to be able to buy politicians, and create the government corruption in the first place, I find your suggestion paradoxical.

Expecting to use relatively small amounts of bribes to control the Government in order to be allowed to avoid paying taxes is wrong somehow.

Re:Tax Cheats? (0)

Anonymous Coward | more than 5 years ago | (#27202069)

Like cheating an inept and corrupt government is wrong somehow.

That would explain why so many of Obama's senior democrat appointments have been evading taxes for decades.

Re:Tax Cheats? (1)

theillien (984847) | more than 5 years ago | (#27202391)

And I bet they're the only political appointees to ever do that.~

Secretary of Treasury (3, Insightful)

onefriedrice (1171917) | more than 5 years ago | (#27201511)

Aryabhata writes in with news that should chill the hearts of... tax cheats everywhere..

Well, if cheating on taxes becomes less profitable, they may have a bright future in politics.
I know someone who can get them high positions in the US government...

Swiss secrecy died over a decade ago ... drugs (0)

Anonymous Coward | more than 5 years ago | (#27201771)

Yes, the irony of an Administration run by Tax Cheats and Leona Hemsleys going after "rich" tax evaders is not lost on the objective (only the true believers **cough**cough** I mean "non-racists").

That aside, Swiss secrecy died well over a decade ago due to drug and money laundering laws.
Your best bet for a truly secret bank account is now (and has been) an Asian chop-account. The chop-account is very popular among the Japanese wealthy due to Japan's high tax rate.
Caribbean or more generally Island (e.g., Isle of Man) accounts tend to be popular among drug dealers for their anonymity and lack of Search Treaties (which killed the value of Swiss numbered accounts). Plus you don't incur the Swiss 35% withholding taxes on your account.

So, if you really wanted a secret account and were competent you'd have your money in somewhere else besides a Swiss account.
I also want to point-out non-Americans have little need to secretly move their assets overseas (to lower tax destinations) because the US is alone in the world in taxing you based on citizenship versus residency.
For example, St. Bono didn't want to pay Irish taxes on his wealth and relocated his business to a low tax country. Ireland has no legal problem with this (although the moral hypocrisy was noted).

Re:Secretary of Treasury (3, Interesting)

value_added (719364) | more than 5 years ago | (#27202073)

Well, if cheating on taxes becomes less profitable ...

You may want to enlighten yourself on how easy it is under intense scrutiny by those in charge or otherwise wielding power to be judged non-compliant. Chances are you'll discover that in the area of tax law, "cheating" is not synonymous with "filing incorrectly", "foretting to pay", or "being advised that additional taxes are payable". Granted, people in the public eye should know better, or cover their asses better, but I doubt that you or most other individuals believe it necessary to have on staff a full-time lawyer (let alone a qualified tax attorney), or pay the monthly fees of a large accounting company just so they can file their taxes.

Quite frankly, your comments smacks of trollishness and reminds me how people misuse words in the immigration debate to make disingenous comments. The naturalization process is horrendously complex and the bureaucracy is slower than dirt (not unlike the IRS in many respects). Forgetting to pay a fee, fill out yet another of any number of thousands of possible forms (or doing so incorrectly), or engage in typically innocent or benign behaviour (getting married, stepping out the country for a visit) are mostly technical violations. They do not, in most cases, deserve a characterisation of "illegality", "illegal immigrant" or a "cheat". Unless you're Lou Dobbs, of course.

One World Government? (0)

Anonymous Coward | more than 5 years ago | (#27201525)

Seems like another step towards world government and world currency to me.

Or maybe I need to take the tinfoil hat off.

Oh No! (0)

Anonymous Coward | more than 5 years ago | (#27201555)

Oh no, now Madoff is REALLY in the deep stuff!

Show me the names (-1, Troll)

Anonymous Coward | more than 5 years ago | (#27201575)

All 4800 victims of Bernie Madoff have been made public.

Does anyone really believe that the 50,000 names of tax evading Americans with numbered accounts will see the light of day?

When Phil Gramm (aka Foreclosure Phil - http://www.slate.com/id/2194933/) became an executive with UBS bank, he was spitting in your face.

Now that UBS hints that they will release names - after a long delay, he's doing it again.

If someone would offer a reward to any hacker that can penetrate Swiss bank security and supply the names and account info . . . No, that would be too good.

Re:Show me the names (0)

Anonymous Coward | more than 5 years ago | (#27201749)

SOOOO RIGHT!

Phil Gramm was chairman of the U.S. Senate Committee on Banking, Housing, and Urban Affairs from 1995-2000 ( http://en.wikipedia.org/wiki/Phil_Gramm ).

He was also one of five co-sponsors of the Commodity Futures Modernization Act of 2000 which spawned the "Enron loophole".

The Gramm-Leach-Bliley Act in 1999 removed controls on US banks and ushered in the problems we face today.

When Gramm quit the Senate, he went to work for UBS, a Swiss bank that paid Gramm to lobby George W. Bush to remove all remaining consumer protection laws for banks and investment firms, which UBS happens to be. http://www.ickypeople.com/2009/02/swiss-bank-steals-20-billion-from-us.html

And hey! There's already a reward being offered - http://2.bp.blogspot.com/_wcOjkvHl9yc/SaI-KGM9j3I/AAAAAAAACTk/a3FJtACPXLo/s1600-h/2881308992_af2090cfd2.jpg

And if you want to know Phil in his own words, ry this link:
http://news.google.com/news?pz=1&ned=us&hl=en&qsid=foT_QIzq_fPwXM

Re:Show me the names (0)

Anonymous Coward | more than 5 years ago | (#27201953)

When Phil Gramm (aka Foreclosure Phil - http://www.slate.com/id/2194933/ [slate.com] ) became an executive with UBS bank, he was sitting in your face.

You're welcome

Sad day (1, Insightful)

Anonymous Coward | more than 5 years ago | (#27201581)

It's a sad day when everyone who wants some privacy for their finances is automatically suspected of being a tax cheater or whatever - especially on Slashdot.

Can the banks be trusted? (1)

slashqwerty (1099091) | more than 5 years ago | (#27201599)

How does a person get their money out of these numbered accounts? What recourse does a person have if the bank refuses to hand over their money? Depositors certainly aren't going to go to the police if they're hiding money from the government. Is it really wise to hide your money someplace you'll never see it again?

Re:Can the banks be trusted? (3, Insightful)

seanadams.com (463190) | more than 5 years ago | (#27201649)

How does a person get their money out of these numbered accounts? What recourse does a person have if the bank refuses to hand over their money?

It's called trust. The Swiss banking system has earned it over the course of more than three hundred years. Honestly, where do you think your dough is safer: a numbered Swiss account, or an American account with your name on it?

Not everyone who has accounts in a different country is doing so to cheat on taxes. If you're really loaded it would stupid not to spread the risk across multiple countries/banks, to minimize your exposure to precisely the kind of clusterfuck that's happening now.

Re:Can the banks be trusted? (1)

guruevi (827432) | more than 5 years ago | (#27201717)

Most of these account have a personal account manager that represents the bank. Kinda like here in the US if you have more than 100k in your account, you get assigned a personal 'wealth' consultant (at least that's what my bank calls it) who basically manages all your assets and recommends what to do with them. Some of their services are included in the price of having your moneys at their bank and some you have to pay for.

I think if these bankers are going to compromise their trust with their clients, the banks won't survive for a very long time. There will be a run for the bank which is (as we've seen the last couple of years) very, very bad for any bank and with it the country's economy. The wealthy will always find someone or some company to manage their assets even if it means they have to move them to another country, it's only a phone call away. If you believe the movies/media and you piss off a drug baron with their money you might end up in a not-so-favorable situation.

Facts & fiction (5, Informative)

olesk (211973) | more than 5 years ago | (#27201661)

As possibly the only Swiss banker on Slashdot I should perhaps point out that:
- "numbered accounts" are a myth from James Bond movies. They do *not* exist. What is referred to as a "numbered account" is an account where the bank offers to send all communication without referencing the name of the client, as a way of preserving anonymity if the communication is intercepted/stolen
- ID requirements for opening a Swiss bank account today are *more* stringent than in EU. France is notably lax, which is a little ironic (you need to document not only who you are but *how* you got the money, and if there ever is a case where a bank fails to follow these guidelines, they can lose their banking license). Citizens of certain countries will find it nearly impossible to open an account in Switzerland as the level of documentation in their home country is not acceptable for opening a Swiss bank account.
- The Swiss distinguish between tax fraud (fabricating papers, forging signatures etc.) which is a criminal offense and where the bank will hand over information on your account, and tax evasion (failing to list all assets/income) which is *not* a criminal offense in Switzerland. The latter category they have now conceded to assist with on a case by case basis.

It is easy to misunderstand Swiss banking secrecy as some kind of dodgy way of assisting rich foreigners with tax fraud/evasion. In fact there is no difference between the rights of a wealthy foreigner and someone like me who (though not a Swiss national) has a job and get a regular salary in Switzerland. We all have the same rights.

To understand where all this comes from, one has to understand the very strong federal system of Switzerland. The Swiss "cantons" are almost as independent as separate states, with a weak and small central government. It boils down to this: the rights of the individual is valued much higher than the rights of the state. This is why the Swiss police cannot (nor the "IRS" or any other government entity) get my account information in Switzerland. This tilt of rights in favor of the individual versus the state also leads to a lot of other differences from most other countries, like that assisted suicide is legal in some cantons, including my canton of Zurich, liberal drug policies etc. In certain cantons you can actually negotiate your tax with the local cantons (who all have different tax rates) directly.

Mod parent up! (1)

Philzli (813353) | more than 5 years ago | (#27201711)

It's really all you need to know. (Discl.: I am Swiss)

Re:Mod parent down! (0)

Anonymous Coward | more than 5 years ago | (#27202297)

All I need to know is that you are a Swiss leech.

I am sick and tired of supporting your most profitable industry with my tax dollars.

Re:Facts & fiction (-1, Troll)

Anonymous Coward | more than 5 years ago | (#27201821)

The Swiss had an ignominious history in WWII. They looked out for their own financial interests at the expense of all others.

I have a friend that was born Swiss and left the country because he refused to pay the national tax to support organized religion. So how does this tax support the "rights of an individual" that you are so proud of?

Re:Facts & fiction (3, Informative)

Corbets (169101) | more than 5 years ago | (#27202075)

If that's the case, your friend is an idiot.

The "confession" tax is based on the religion you claim. One valid choice is "no religion", in which case you don't pay any such tax. I know; I've never paid the church tax, but I've worked in Switzerland for 3 years. Admittedly, it takes a couple of extra pieces of paper for a Swiss person to get rid of the tax than for a foreigner, but it's easy enough to do.

Further, the "ignominious history" you referred to is bullshit. The US ignored the problems in Europe almost entirely for years, providing relatively little aid to stop Hitler, until we were drawn into the war against our will. That strikes me as just as bad.

Quit being a monkey; evolve a little bit, would you?

Re:Facts & fiction (-1)

Anonymous Coward | more than 5 years ago | (#27201891)

"numbered accounts" are a myth from James Bond movies. They do *not* exist.

As possibly the only Swiss banker who has never heard of Panama, you should take a vacation to our lovely little country and eat your words.

Re:Facts & fiction (2, Informative)

olesk (211973) | more than 5 years ago | (#27202041)

My apologies, let me clarify - they do not exist in SWITZERLAND, which I believe is the topic of discussion here.

Re:Facts & fiction (3, Informative)

olesk (211973) | more than 5 years ago | (#27202057)

Oh, and by the way, they were disbanded in Panama too in the 1990s.

http://www.panamalaw.org/numbered_bank_account.html [panamalaw.org]

Re:Facts & fiction (2, Informative)

chill (34294) | more than 5 years ago | (#27202183)

While I appreciate all the information you posted on Swiss accounts, you'd better read that link to Panama accounts again.

Scroll down to the last account type, Panama Bearer Share Corporate Bank Account and read it again. Quote:

Panama has essentially replicated the numbered bank account by combining anonymous bearer share corporations with their strong bank secrecy.

Re:Facts & fiction (0, Redundant)

drsquare (530038) | more than 5 years ago | (#27201935)

So if tax evasion is legal, why does anyone bother paying any taxes?

Re:Facts & fiction (0)

Anonymous Coward | more than 5 years ago | (#27202027)

He never said it was legal, he said it was not a criminal offense.

Re:Facts & fiction (1, Informative)

Anonymous Coward | more than 5 years ago | (#27202175)

So if tax evasion is legal, why does anyone bother paying any taxes?

Because in Switzerland, tax is withheld at the source, so you don't get a chance to avoid taxes.

Incidentally, tax evasion is illegal in Switzerland, but it is a very minor offense, similar to a parking ticket in New York.

Re:Facts & fiction (0)

Anonymous Coward | more than 5 years ago | (#27202239)

Evasion is not legal, it's just not considered a criminal offense. You'll be heavily fined if the govt finds out but you can't be thrown into jail over it. The system works well for Switzerland but causes problems for other states with less liberal tax systems.

Re:Facts & fiction (1)

seifried (12921) | more than 5 years ago | (#27202113)

"and if there ever is a case where a bank fails to follow these guidelines, they can lose their banking license)." Has this actually ever happened? I suspect this is a red herring similar to the "lawyers/engineers/doctors/psychologists/psychiatrists/etc. can lose their license" which virtually never happens.

Re:Facts & fiction (1)

olesk (211973) | more than 5 years ago | (#27202461)

To be honest I do not know, and I would suspect you are right. What I can say for sure though, is that in my own organization, this is is considered an absolute rule and I'd be willing to bet anything that it has never been broken. You risk jail and losing your job - I don't think any ticket (i.e. new account) is worth that (at least not to me, and I'm 100% sure not to my colleagues).

Can't stop me. (1)

shellster_dude (1261444) | more than 5 years ago | (#27201739)

Well this is good news for me. When I take over my
small island, and start my tax haven/ banking
empire, I will have less competition.

Now if I could only figure out how to get my bribe
money out of my frozen Swiss accounts,
I would be on my way.

Money Transfers (-1, Troll)

Anonymous Coward | more than 5 years ago | (#27201977)

If you leave the country with more than $10,000, you are required to report the amount to US Customs.

Why shouldn't this apply to ALL money transfers - in and out of the country?

Noncompliance should be a federal offense resulting in forfeiture of the full amount.

Re:Money Transfers (1)

shentino (1139071) | more than 5 years ago | (#27202371)

And then corrupt customs agents will conveniently lose your report and then you'll get scrubbed.

not to mention that victims of mere clerical error are going to get screwed.

Remember US vs $124,700?

This idea has fatal flaws.

i think you are on the right track, but I wouldn't put THAT much faith in the feds.

A prettied-up version of organized crime (1, Insightful)

bartwol (117819) | more than 5 years ago | (#27202085)

For many year, organized criminals in the U.S. functioned with impunity. Even though the same unseemly guys were always around when the law was being broken, there was never satisfactory evidence to prove that they, themselves, had broken the law.

Then came the RICO [wikipedia.org] laws.

RICO advanced the law by recognizing and identifying patterns of criminal activity, and then asserting that the people regularly associated with those activities were guilty of racketeering. These laws have worked well in our efforts to deter organized crime.

All Swiss banking activities aren't intended to skirt the law, but then, neither were John Gotti's activities. But the purpose and benefits of Swiss secrecy laws are, by patterns of their use, obvious. No, the banker didn't evade taxes. He simply engaged in practices carefully crafted to enable others to do so. By pattern and association, under RICO, the banker could be charged with racketeering because he repeatedly and specifically enables the practice of money laundering.

So you can tell me that Swiss bankers aren't running huge scale rackets. But that incenses me. To quote Judge Judy: "Don't pee on my leg and then tell me it's raining."

The Swiss bankers are becoming "cooperative" now in hopes that the rest of the advanced world of criminal justice doesn't finish painting the full picture of Swiss banking "ethics." The white collars on their shirts are the only outstanding signs of cleanliness there.

Re:A prettied-up version of organized crime (5, Funny)

Dramacrat (1052126) | more than 5 years ago | (#27202475)

You just quoted Judge Judy, rendering your entire legalese null and void.

My Mattress (2, Funny)

nurb432 (527695) | more than 5 years ago | (#27202453)

Is looking more and more like a viable solution for future banking needs.

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