Swiss lawyers blast secretive US bank deal

A secretive deal between Bern and Washington over Swiss banks' alleged complicity in tax evasion by Americans is "deeply worrying," according to the new head of the Swiss Bar Association.

An employee at a money changer counts $100 bills on October 25, 2012. A secretive deal between Bern and Washington would enable Swiss banks to circumvent some elements of the country's cherished bank secrecy laws and turn over key information to US authorities.

The deal "is deeply worrying from the rule of law point of view," Pierre-Dominique Schupp said late Friday in Lucerne after his appointment as head of the Swiss Bar Association (SAV), according to a written version of his speech.

"One should not play with the rule of law," he insisted.

Swiss Finance Minister Eveline Widmer-Schlumpf announced a deal last week that she said would put an end to the row that has been poisoning relations between Switzerland and the United States for years.

However, she acknowledged, the settlement was not a negotiated agreement but a "unilateral offer" from Washington, and due to a confidentiality clause, no details of the deal could be divulged until parliament had given it its blessing.

She urged parliament, which has no power to amend the agreement, to urgently debate the issue so it could take effect by July 1, but the lower house on Wednesday voted to freeze their handling of the issue until they had more information.

The deal "is without any remedy that could protect the concerned parties," cautioned Schupp, lamenting also that "the banks' obligations are not clear."

Washington has repeatedly accused Swiss banks of complicity in tax evasion, since they hold billions of dollars belonging to American citizens that are not declared to US tax authorities.

The controversial deal would enable Swiss banks to circumvent some elements of the country's cherished bank secrecy laws and turn over key information to US authorities.

How much the banks will have to pay to win legal closure is not yet known, but Swiss media have reported that the overall figure could hit 10 billion Swiss francs ($10.5 billion, 8.0 billion euros).

Swiss State Secretary Michael Ambuehl meanwhile adamantly defended the deal in a speech to the SAV conference on Saturday, insisting that without it Washington might take its frustration out on Switzerland's entire financial industry, according to the ATS news agency.

He also stressed that rule of law would be kept intact and that the agreement handed to parliament provided an important element in the creation of a legal framework for the cooperation between the Swiss banks and Washington.