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Swiss view Birkenfeld reward as 'provocation'

Malcolm Curtis · 12 Sep 2012, 11:15

Published: 12 Sep 2012 11:15 GMT+02:00

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Birkenfeld, a former Geneva employee of the Swiss bank, was granted the record sum by the Internal Revenue Service for providing inside information about UBS’s illegal schemes to enable tax evasion by American citizens, according to the Washington-based National Whistleblowers Center.

The 47-year-old former employee is credited with providing information that forced UBS to pay a $780 million penalty and provide the names of 4,900 American clients to US authorities.

This also sparked a tax dispute between the US and Switzerland that continues to dog relations between the two countries.

Birkenfeld’s handsome reward was branded a “massive provocation against Switzerland,” by Pirmin Bischof, a Christian Democratic Party MP and a lawyer who studied in the US.

The country would respond “appropriately by remaining calm”, he said.

Christoph Blocher, controversial Swiss People’s Party MP, said the Americans have spent $104 million on “a traitor who has previously been jailed”.

Another politician, Hans-Peter Portmann of the Liberal party in Zurich, called the reward “decadent”.

A spokesman from the Swiss Bankers Association declined comment.
UBS is also officially remaining mum, although newspaper Tages Anzeiger said “bitter comments” were heard behind closed doors at the bank over the news.  

Birkenfeld’s reward marks a victory for employees who snitch on their employers, but for the Swiss financial sector “this victory amounts to a defeat”, said Le Temps newspaper in an editorial published on its website.

The millions of dollars given to the former UBS banker could incite other bankers who have recently lost their jobs to provide more information to US authorities, the newspaper says.

Birkenfeld, who only last month was released from prison after serving a jail sentence for his involvement in aiding tax evasion, is being rewarded for weakening UBS and Swiss banking secrecy, Le Temps said.

But the dollars he received “also represent a victory for whistleblowers, without whom the big scandals cannot emerge”.

Birkenfeld was awarded the money even before his 40-month prison term had been completely served, Tages Anzeiger reported.

The Zurich-based newspaper noted that the former UBS employee was sentenced in August 2009 for helping a billionaire hide $200 million from US tax authorities through accounts in Switzerland and Liechtenstein.

Malcolm Curtis (news@thelocal.ch)

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Your comments about this article

2012-09-12 12:49:03 by HoppSuisse
There is only 1 way to stop this.

1 – Make an arrest order for Birkenfeld and demand that the US extradite him. Then fine him 104 million USD. After taxes he will be about 52 million in debt.
2 – Arrest and jail all the Politicians and Court Officials that allowed UBS to break our privacy laws.
3 – Arrest and jail the Bankers involved.

This will send a strong message to the US and Bankers to stop all this nonsense. HoppSuisse
2012-09-13 06:43:10 by Meppin
The US has declared economic war on Switzerland. The US is VERY vulnerable given its debt load and the role of the US Dollar. If the US persists in this war on Switzerland, the Swiss Government should announce that all Swiss financial institutions will be prohibited from purchasing ANY US dollar denominated securities, and current portfolios will be "liquidation only" for US dollar assets. Also the SNB will no longer hold and US dollar holdings and be selling it all. This will mark the end of the US Dollar as the global reserve currency and the end of this constant bullying by the most hypocritical regime in the modern era.
2012-09-13 13:03:45 by HoppSuisse
Great Idea Meppin,
Probably just the threat of abandoning the USD would solve the problem for us. Of course we could not buy oil from OPEC but we buy from Iran and Russia anyway.

Its going to happen some day, the only question is how much USD debt we are stuck with.
Im hoping that we are smart enough to take the CHF we are printing, and trading for € to weaken the CHF, and buy gold. Another factor is that the Bank of International Settlements (BIS) is in Basel. The BIS is a country of its own with its own laws and security force. We should threaten this status.

But we have a neutral mentality and traditionally compromise and appease aggressors.
Also we just had a vote to forfeit the right to vote on international treaty.

2012-09-13 15:46:29 by Meppin
The politicians need to understand when the US government people arrive and smile and shake hands, they are not smiling, they are showing their teeth! Only the threat of this action on the part of the SNB/Switzerland will put the US back in its box once and for all. Enough is enough of their bullying. We can push back as well, we are not without financial weapons. If such a rumor even began, the US has A LOT more to lose than Switzerland. The dollar would crash and the US would ground to a halt. This is the final straw.
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