Select Page

Swiss bank accounts have offered the appeal of secrecy for hundreds of years. Some wealthy American depositors have taken advantage of this secrecy to hide assets and evade taxes. Others use the offshore accounts in ways that do not run as much risk of the IRS’s displeasure.

Regardless of the depositors’ motives, the growing U.S. government crackdown on the secrecy of Swiss bank accounts held by Americans has caused many depositors to flock to Singapore and Hong Kong. These locations still offer some of the world’s most secret accounts.

However, there is a twist in this shift to the East: Many of the banks growing in these low-tax oases have Swiss origins. And their clients are not only Asia’s growing number of millionaires but also wealthy Americans and Europeans who, Orange County tax attorneys speculate, have been spooked by mounting scrutiny from the tax authorities at home.

From gigantic UBS to smaller private banks like Julius Baer, Swiss banks and those with Swiss-based operations are tripping over themselves to expand in Asia.


UBS has lost billions in assets in Switzerland in the last two years, but has gotten more new money in Asia than it has lost at home. UBS has 867 client advisers in Asia, and plans to add four hundred more.

Singapore does not have taxes on capital gains, nor most foreign dividends; depositors can open accounts in the guise of corporations, trusts and limited liability companies.

Hong Kong allows the formation of opaque companies that can be used to evade taxes. It also does not tax capital gains or deposit interest, and for corporations, it taxes only income produced in Hong Kong.

After the struggle with the U.S. authorities, UBS shut down what it and prosecutors called its “United States cross-border business,” which was offshore, undeclared private banking services for Americans.

But cross-border banking at UBS is still available in Singapore and Hong Kong.

Source: New York Times “Seeking Bank Secrecy in Asia” 9/22/2010