By Dow Jones Business News,
May 10, 2014, 08:34:00 AM EDT
By John Letzing
ZURICH--U.S. authorities delivered a public blow to a Swiss firm that helped Americans use insurance products to
hide money, part of a broader campaign to root out undeclared assets stashed in the offshore wealth haven.
The Justice Department said Friday it reached a non-prosecution agreement with Zurich-based Swisspartners Group,
which will pay $4.4 million in forfeitures and restitution and acknowledged helping American clients maintain undeclared
bank accounts. The deal also has Swisspartners handing over the identities of 110 of its U.S. clients. In a legal
filing, the Justice Department said methods used by the firm included selling insurance policies that were funded by
assets held in undeclared Swiss accounts. Those accounts were held in the name of the insurance firm, helping conceal
the owners' identities.
The deal marks the first such publicly disclosed agreement between the Justice Department and a Swiss firm dealing
in insurance products that can be used by policyholders to conceal underlying assets from tax authorities, according to
people familiar with the matter.
The Wall Street Journal reported in February that U.S. authorities had begun scrutinizing Americans' use of Swiss
insurance products such as private placement life insurance to hide assets, and that a number of Swiss insurers
including Swiss Life Holding AG had stopped serving U.S. clients with related products.
In a statement, Swisspartners Group parent company Liechtensteinische Landesbank AG said the agreement "
conclusively" resolves the unit's U.S. tax issues. Liechtensteinische Landesbank said it would now resume efforts to
The relatively recent move to clamp down on the use of insurance products to hide money in Switzerland comes
several years after the effort to track down undeclared American money in the country began in earnest thanks to a
deferred prosecution agreement between the Justice Department and Swiss banking giant UBS AG. UBS agreed in 2009 to pay
$780 million to settle the matter.
UBS rival Credit Suisse Group AG is expected to reach a related settlement with the Justice Department that will
amount to significantly more than $1 billion. Credit Suisse is one of about a dozen Swiss banks that have come under
Justice Department investigation in recent years for allegedly aiding U.S. tax evasion.
In addition, hundreds of other Swiss banks have signaled they will participate in a Justice Department self-
reporting program unveiled last year, which requires the banks to hand over information about their U.S. accounts in
exchange for guarantees that they won't be prosecuted.
Write to John Letzing at firstname.lastname@example.org
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