Private Swiss Bank Says It Is Under Investigation in U.S.
By John Letzing
ZURICH--A private bank that bills itself as the oldest in Zurich disclosed it is among the 14 Swiss banks currently
under investigation by U.S. authorities for allegedly aiding American tax evasion.
Rahn & Bodmer Co. partner Christian Rahn said Wednesday that his bank recently learned it is among so-called category-
one Swiss banks, the group of banks that are already under investigation by the U.S. Department of Justice. Mr. Rahn
said the bank stopped dealing with untaxed U.S. funds in 2008, and has advised American clients to take part in
voluntary offshore-disclosure programs offered by U.S. authorities.
Mr. Rahn said that client use of those disclosure programs, which have drawn tens of thousands of participants, likely
caused his bank to come under investigation by American authorities.
Rahn & Bodmer, which was founded in 1750, says it has about 200 employees and 12.5 billion Swiss francs ($13.4
billion) in assets under management.
Banks previously known to be in the group already under investigation include Credit Suisse Group AG (CSGN.VX) and
Julius Baer Group (BAER.VX).
As part of an agreement between the U.S. and Swiss governments late last month, a large chunk of Switzerland's other
roughly 300 banks have now been urged to participate in a program that will have them disclose extensive amounts of data
regarding American accounts on their books.
The participating banks in what is known as category two, which are thought to have held undeclared U.S. assets, are
expected to pay related fines of as much 50% of the value of those assets in order to avoid criminal prosecution. Mr.
Rahn said he had previously assumed Rahn & Bodmer would be included in category two, and as a result it has already
begun compiling data on its U.S. accounts that can be provided to American authorities.
Switzerland's oldest bank, Wegelin & Co., was indicted last year for aiding American tax cheats, and the bulk of its
business was subsequently sold off to a large retail bank.
UBS AG (UBSN.VX), Switzerland's biggest bank, reached a deferred-prosecution agreement with the DOJ in 2009. The bank
admitted to aiding American tax evaders and paid a $780 million fine as part of the agreement.
Write to John Letzing at email@example.com
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