UBS to shut down Swiss-based services for its US clients
A UBS executive told a US Senate panel that the Swiss company will shutter its private banking services that have served US clients from Switzerland.
"That means UBS will no longer provide offshore banking or securities services to U.S. residents through our bank branches," said Mark Branson, chief financial officer of UBS Global Wealth Management and Business Banking. "While we are winding down this business, there will be no new accounts opened and Swiss-based client advisors will not be permitted to travel to the United States for the purpose of meeting with US clients," he added.
The announcement came as Senate investigators unveiled a 115-page report detailing an aggressive effort by UBS bankers to market offshore banking services to wealthy US clients. UBS officials are under investigation by US law enforcement authorities for conspiring to help U.S. clients avoid taxes.
"I am here to make absolutely clear that UBS genuinely regrets any compliance failures that may have occurred," Branson told the Senate panel.
The US loses about $100bn (€63.2bn) annually due to offshore tax evasion, according to the Senate probe, which is taking aim at UBS and Liechtenstein's LGT Group for allegedly marketing tax-evasion strategies to wealthy Americans.
US clients hold about 19,000 accounts at UBS, with an estimated $18bn to $20bn in assets, in Switzerland, according to the findings from the Senate probe and Justice Department prosecutors.
LGT declined to send a representative to Thursday's hearing.
"While LGT declined to testify for the subcommittee, it has cooperated by sending a senior official of the bank for a lengthy interview,' Michael Robinson, a spokesman for the bank said in a statement. Robinson added that the bank had produced all requested documents and answered all questions permitted under Liechtenstein's laws.
A federal judge ruled this month that the Internal Revenue Service could serve legal papers to UBS in an expanding probe of US taxpayers who may have used overseas accounts to hide assets and avoid taxes. UBS has said it is cooperating with Swiss and American investigations and will disclose records involving US clients who might have broken tax laws.
—Write to Martin Vaughan at martin.vaughan@dowjones.com; Evan Perez and the Associated Press contributed to this article.
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