Swiss banks' move 'to aid graft fight'
Updated: 2014-05-08 04:30
By EMMA DAI in Hong Kong and AN BAIJIE in Beijing (China Daily)
A decision by Switzerland to hand over details of secret bank accounts in the country to other nations will benefit China's ongoing anti-corruption campaign, financial specialists say.
The Swiss pledged on Tuesday to provide details of foreign bank accounts, marking a breakthrough in the global crackdown on tax evasion.
The Financial Times reported that Switzerland committed itself to signing a new global standard on automatic exchange of information. The move is being viewed as a decisive break away from traditional Swiss protection of banking clients' privacy.
"The move will definitely help anti-corruption efforts in China, as Switzerland is the world's largest offshore financial center," said Shen Minggao, head of China research at Citibank.
"It will become much easier for the Chinese authorities to collect information on overseas accounts relating to corrupt officials."
The Swiss policy change pledge was made at a meeting of the Organization for Economic Cooperation and Development in Paris.
The declaration was signed by more than 40 countries, including other member countries of the OECD and G20 nations.
It requires the collection and exchange of information on bank accounts and the beneficial ownership of companies and other legal entities such as trusts.
The Swiss Bankers Association said, "The banks in Switzerland are willing to adopt the automatic exchange of information along with other financial centers, provided that the exchanged information is only applied for tax purposes."
Ren Jianming, a professor of clean governance research at Beihang University in Beijing, said foreign banks are the places most favored by corrupt Chinese officials to deposit their ill-gotten gains, because of client privacy.
The policy change by the Swiss authorities will contribute to international anti-corruption cooperation efforts, Ren said.
Late Philippine president Ferdinand Marcos had billions of dollars in secret Swiss bank accounts, and imprisoned former Taiwan leader Chen Shui-bian also had deposits in Swiss banks, Ren said.
Shen said, "I believe improving transparency is a global trend."
As more governments join hands in fighting corruption and tax evasion, the cost of justice will start to come down, even though it may still take time for the new agreement to take full effect, he added.
Contact the writers at firstname.lastname@example.org and email@example.com.