WASHINGTON -- Switzerland's government is agreeing to turn over the names of nearly 4500 owners of secret accounts at the banking conglomerate called UBS.
The settlement follows a long-running effort by the U.S. government to penetrate Swiss bank secrecy and catch tax evaders. The United States had been seeking a federal court order demanding that UBS identify the American holders of 52,000 accounts. The Swiss government vowed to prevent such a disclosure, leading to weeks of negotiations and Wednesday's announcement.
"We will be receiving an unprecedented amount of information," IRS Commissioner Doug Shulman said Wednesday morning. "This agreement represents a major step forward with the IRS's efforts to pierce the veil of bank secrecy and combat offshore tax evasion."
The process could take a year.
Shulman said the deal sends an "unmistakable message" to tax dodgers: "Wealthy Americans who have hidden their money offshore will find themselves in a jam," he said.
The Swiss government has agreed to work with the United States on similar requests for disclosure involving other Swiss banks, Shulman said in a conference call with reporters.
IRS officials offered no estimate of how much the agency might recoup in back taxes and penalties.
"This agreement helps resolve one of UBS's most pressing issues," UBS chairman Kaspar Villiger said in a statement. "I am confident that the agreement will allow the bank to continue moving forward to rebuild its reputation through solid performance and client service. UBS welcomes the fact that the information-exchange objectives of the settlement can be achieved in a lawful manner under the existing treaty framework between Switzerland and the United States."
UBS will pay no penalties under the deal, the bank said.