Raoul Weil, a former UBS wealth management chief,
was arrested last weekend in Italy and faces extradition to the United States to
answer charges of aiding and abetting tax evaders. Weil left Switzerland’s
biggest bank in 2009 after he was declared a fugitive from US justice by
ignoring a criminal indictment issued in 2008. UBS was forced to pay a $780m
fine in 2009 after admitting to actively assisting US tax evaders to break US
Several Swiss bankers and lawyers have since been indicted in the US for
their alleged role in helping wealthy US citizens hide their assets from the tax
Weil is one of the most high-profile of the accused as a then head of UBS’s wealth
management and he is now a temporary resident of an Italian prison, likely
fearing a longer spell in a US one.
A Florida court indictment charged Weil with having a prominent role in aiding
UBS’s US clients to hide around $20bn in undeclared assets between 2002 and
2007. He however has strongly denied the allegation but would not risk
defending himself in a US court.
Since 2008, the US government has been
aggressively moving against both US taxpayers who have undeclared foreign
accounts and Swiss banks, including triggering the closure of Wegelin & Co.,
founded in 1741, which was the oldest bank in Switzerland and said to be he
13th oldest in the world.
This may seem hypocritical given that US
companies are the ringleaders in corporate tax avoidance and evasion, by alleged
“job creators and innovators.” It is of course hypocritical and we operate
a similar Bodhaire Uí Laoire towards the corporate side in contrast with the
aggressive attitude of the Revenue to personal users of tax havens.
However, the Swiss banks were not fragile
Alpine flowers. After UBS admitted guilt, private banks like Wegelin offered the
American tax evaders new homes for their wealth.
The Foreign Account Tax Compliance Act (FATCA),
which was signed into US law in early 2010 as part of the Hiring Incentives to
Restore Employment Act, requires foreign financial institutions to report
information regarding US persons maintaining accounts, and by directing that US
taxpayers report certain specified foreign financial assets with their tax
Bologna police confirmed on Sunday that they had arrested Weil at a hotel in
the city. He is reported to have been travelling under his real name which
alerted the Italian authorities to the international arrest warrant.
Weil is a managing partner at Reuss Private Group, a financial consultancy
company based in Pfäffikon, canton Schwyz, according to the firm’s website.
In a statement on Monday, Reuss Private Group said it had been informed on
Sunday of the arrest.
“Raoul Weil has worked for Reuss Private Group since 2010, first as a
consultant, and then, since the beginning of this year, as its CEO,” the
“Raoul Weil does not have any functions at Reuss Private AG, a Bremgarten-based
asset manager owned by Reuss Private Group that is licensed by the Swiss
Financial Market Supervisory Authority FINMA to operate as a securities dealer.”
The Reuss website says Raoul Weil has a degree in
business and economics from the University of Basel, as well as having done
advanced studies at the Kellogg School of Management in the United States.
Last week the Zurich-based Bank Frey has decided
to close, citing an inability to meet
rising costs and obligations associated with the US tax evasion fight. The move
was voluntary, as the private institution remains solvent and won't be
“As a result of developments in recent years, circumstances and challenges have
presented themselves, especially in Switzerland, that mean it no longer makes
sense for a small bank to continue its cross-border services,” said Markus A.
Frey, the chairman of the board who founded the institution in 2000. “Bank Frey
will therefore cease its operative business activities as a bank.”
Swissinfo says that although the US Department of
Justice (DoJ) recently offered Swiss banks a unilateral programme to address tax
evasion and banking secrecy disputes, Bank Frey is part of the 14 “Category One”
banks who could not participate because they are involved in ongoing legal
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