|
Joint Statement between the U.S. Department of Justice and the
Swiss Federal Department of Finance
1. The United
States Department of Justice has been and continues to be engaged in law
enforcement action against individuals and entities that use foreign bank
accounts to evade U.S. taxes and reporting requirements, and individuals and
entities that facilitate the evasion of U.S. taxes and reporting
requirements. In announcing today the Program for Swiss banks the Department
of Justice intends to provide a path for Swiss Banks that are not currently
the target of a criminal investigation authorized by the U.S. Department of
Justice, Tax Division, to obtain resolution concerning their status in
connection with the Department's overall investigations, and to assist the
Department of Justice in its law enforcement efforts. The Program does not
apply to individuals and is not available to any Swiss bank as to which the
Tax Division has authorized a formal criminal investigation concerning its
operations.
2.
Switzerland welcomes the efforts of the Department of Justice to provide the
Program and intends to draw the attention of the Swiss Banks to the terms of
the Program and encourages them to consider participating therein.
Switzerland notes that the Swiss Parliament by Declaration of 19 June 2013
stated its expectation that the Swiss Federal Council will take all measures
within existing legal framework to put Swiss banks in a position to cooperate
with the Department of Justice. Switzerland represents that applicable Swiss
law will permit effective participation by the Swiss Banks on the terms set
out in the Program.
3. The
signatories take note that the Swiss Financial Market Supervisory Authority
intends to encourage, within its supervisory powers, all Swiss Banks to send
a letter to U.S. Persons or Entities with U.S. Related Accounts at those
Swiss Banks informing them of the Program and drawing their attention to the
Internal Revenue Service Offshore Voluntary Disclosure Initiative.
4.
Switzerland intends to process treaty requests according to the Convention
between the United States of America and the Swiss Confederation for the
Avoidance of Double Taxation with Respect to Taxes on Income, signed at
Washington on October 2, 1996, and the Protocol Amending the Convention,
signed at Washington on September 23, 2009, if and when it is in force and
applicable, as may be amended, and intends to do so on an expedited basis,
including by providing additional personnel and the other necessary resources
to process the requests. 5. Noting the importance attached by both sides to
providing a high level of personal data and privacy protection for all
individuals as provided in their laws, the signatories understand that, if
personal data are provided, they should only be used for purposes of law
enforcement (which may include regulatory action) in the United States or as
otherwise permitted by U.S. law. Personal data should only be retained for so
long as necessary for these purposes.
6. The
signatories intend to resolve any difficulties or doubts arising from this
Joint Statement by way of consultations.
Signed at
Washington, D.C., this 29th day of August, 2013, in duplicate in English.
____________________
JAMES M. COLE
Deputy
Attorney General
United States
Department of Justice
____________________
MANUEL SAGER
Ambassador
Extraordinary
and
Plenipotentiary of
Switzerland
to the United States
PROGRAM FOR NON-PROSECUTION AGREEMENTS OR NON-TARGET LETTERS FOR
SWISS BANKS
I. Scope and Definitions
A. Scope of the Program
This Program
is available to any Swiss Bank
|
1.
|
requesting
a Non-Prosecution Agreement on the terms set out in Paragraph II, below
(Category 2 Bank);
|
|
2.
|
requesting
a Non-Target Letter on the terms set out in Paragraph III, below (Category
3 Bank); or
|
|
3.
|
requesting
a Non-Target Letter on the terms set out in Paragraph IV, below (Category 4
Bank).
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This Program does not apply to individuals and shall not be
available to any Swiss Bank as to which the Tax Division has authorized a
formal criminal investigation concerning its operations (Category 1 Bank) as
of the date of the announcement of this Program. All Category 1 Banks either
have already been notified that the Tax Division has authorized a formal
criminal investigation concerning its operations, or will be so notified
through its counsel by certified mail issued in conjunction with the announcement
of this Program. B. Definitions
|
1.
|
“Department”
means the United States Department of Justice.
|
|
2.
|
“Tax
Division” means the Tax Division of the United States Department of
Justice.
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|
3.
|
“FATCA
Agreement” means the Agreement between the United States of America and
Switzerland for Cooperation to Facilitate the Implementation of FATCA
signed on February 14, 2013. 1
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4.
|
“Swiss Bank”
has the same meaning as the term “Swiss Financial Institution” in the FATCA
Agreement, except that it shall exclude any “Investment Entity” or “Specified
Insurance Company” that does not independently meet the definition of “Custodial
Institution” or “Depository Institution.”
|
|
5.
|
“FFI
Agreement” has the same meaning as in the FATCA Agreement.
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|
6.
|
“Applicable
Period” shall mean the period between August 1, 2008, and either (a) the
later of December 31, 2014, or the effective date of an FFI Agreement, or
(b) the date of the Non-Prosecution Agreement or Non-Target Letter, if that
date is earlier than December 31, 2014, inclusive.
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|
7.
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“U.S.
person” has the same meaning as in the FATCA Agreement.
|
|
8.
|
“Entity”
has the same meaning as in the FATCA Agreement.
|
|
9.
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“U.S.
Related Accounts” means accounts which exceeded $50,000 in value at any
time during the Applicable Period, as measured by the account balance on
the last day of each month during the Applicable Period, and as to which
indicia exist that a U.S. Person or Entity has or had a financial or
beneficial interest in, ownership of, or signature authority (whether
direct or indirect) or other authority (including authority to withdraw
funds; to make investment decisions; to receive account statements, trade
confirmations, or other account information; or to receive advice or
solicitations) over the account, as determined by applying the due
diligence procedures applicable to “Lower Value Accounts” in the FATCA
Agreement, Annex I, Part II, for accounts with $250,000 or less in value at
all times during the Applicable Period, and by applying the due diligence
procedures applicable to “High-Value Accounts” in the FATCA Agreement,
Annex I, Part II, for accounts with more than $250,000 in value at any time
during the Applicable Period, notwithstanding the amounts and dates set out
in the FATCA Agreement, Annex I, Part II.
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10.
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“Independent
Examiner” means a qualified independent attorney or accountant; the Tax
Division reserves the right to object to a particular attorney or
accountant, but will not unreasonably withhold approval.
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11.
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“Non-Target
Letter” means a letter from the Tax Division stating that, as of the date
of the letter and based upon information then known to the Tax Division,
the Swiss Bank to which the letter is addressed is not the target of a
criminal investigation authorized by the Tax Division for violations of any
tax-related offenses under Titles 18 or 26, United States Code, or for any
unreported monetary transactions under §§5314 or 5322, Title 31, United
States Code, in connection with undeclared U.S. Related Accounts held by
the Swiss Bank during the Applicable Period.
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I
Joint
Statement between the U.S. Department of Justice and the Swiss Federal
Department of Finance
1. The
United States Department of Justice has been and continues to be engaged in
law enforcement action against individuals and entities that use foreign
bank accounts to evade U.S. taxes and reporting requirements, and
individuals and entities that facilitate the evasion of U.S. taxes and
reporting requirements. In announcing today the Program for Swiss banks the
Department of Justice intends to provide a path for Swiss Banks that are
not currently the target of a criminal investigation authorized by the U.S.
Department of Justice, Tax Division, to obtain resolution concerning their
status in connection with the Department's overall investigations, and to
assist the Department of Justice in its law enforcement efforts. The
Program does not apply to individuals and is not available to any Swiss
bank as to which the Tax Division has authorized a formal criminal
investigation concerning its operations.
2.
Switzerland welcomes the efforts of the Department of Justice to provide
the Program and intends to draw the attention of the Swiss Banks to the
terms of the Program and encourages them to consider participating therein.
Switzerland notes that the Swiss Parliament by Declaration of 19 June 2013
stated its expectation that the Swiss Federal Council will take all
measures within existing legal framework to put Swiss banks in a position
to cooperate with the Department of Justice. Switzerland represents that
applicable Swiss law will permit effective participation by the Swiss Banks
on the terms set out in the Program.
3. The
signatories take note that the Swiss Financial Market Supervisory Authority
intends to encourage, within its supervisory powers, all Swiss Banks to
send a letter to U.S. Persons or Entities with U.S. Related Accounts at
those Swiss Banks informing them of the Program and drawing their attention
to the Internal Revenue Service Offshore Voluntary Disclosure Initiative.
4.
Switzerland intends to process treaty requests according to the Convention
between the United States of America and the Swiss Confederation for the
Avoidance of Double Taxation with Respect to Taxes on Income, signed at
Washington on October 2, 1996, and the Protocol Amending the Convention,
signed at Washington on September 23, 2009, if and when it is in force and
applicable, as may be amended, and intends to do so on an expedited basis,
including by providing additional personnel and the other necessary
resources to process the requests.
5. Noting
the importance attached by both sides to providing a high level of personal
data and privacy protection for all individuals as provided in their laws,
the signatories understand that, if personal data are provided, they should
only be used for purposes of law enforcement (which may include regulatory
action) in the United States or as otherwise permitted by U.S. law.
Personal data should only be retained for so long as necessary for these
purposes.
6. The
signatories intend to resolve any difficulties or doubts arising from this
Joint Statement by way of consultations.
Signed at
Washington, D.C., this 29th day of August, 2013, in duplicate in English.
____________________
JAMES M.
COLE
Deputy
Attorney General
United
States Department of Justice
____________________
MANUEL
SAGER
Ambassador
Extraordinary
and
Plenipotentiary of
Switzerland
to the United States
PROGRAM FOR NON-PROSECUTION AGREEMENTS OR NON-TARGET LETTERS
FOR SWISS BANKS
I. Scope and Definitions
A. Scope of the Program
This
Program is available to any Swiss Bank
|
1.
|
requesting
a Non-Prosecution Agreement on the terms set out in Paragraph II, below
(Category 2 Bank);
|
|
2.
|
requesting
a Non-Target Letter on the terms set out in Paragraph III, below
(Category 3 Bank); or
|
|
3.
|
requesting
a Non-Target Letter on the terms set out in Paragraph IV, below (Category
4 Bank).
|
This
Program does not apply to individuals and shall not be available to any
Swiss Bank as to which the Tax Division has authorized a formal criminal
investigation concerning its operations (Category 1 Bank) as of the date of
the announcement of this Program. All Category 1 Banks either have already
been notified that the Tax Division has authorized a formal criminal
investigation concerning its operations, or will be so notified through its
counsel by certified mail issued in conjunction with the announcement of
this Program.
B. Definitions
|
1.
|
“Department”
means the United States Department of Justice.
|
|
2.
|
“Tax
Division” means the Tax Division of the United States Department of
Justice.
|
|
3.
|
“FATCA
Agreement” means the Agreement between the United States of America and
Switzerland for Cooperation to Facilitate the Implementation of FATCA
signed on February 14, 2013.
|
|
4.
|
“Swiss
Bank” has the same meaning as the term “Swiss Financial Institution” in
the FATCA Agreement, except that it shall exclude any “Investment Entity”
or “Specified Insurance Company” that does not independently meet the
definition of “Custodial Institution” or “Depository Institution.”
|
|
5.
|
“FFI
Agreement” has the same meaning as in the FATCA Agreement.
|
|
6.
|
“Applicable
Period” shall mean the period between August 1, 2008, and either (a) the
later of December 31, 2014, or the effective date of an FFI Agreement, or
(b) the date of the Non-Prosecution Agreement or Non-Target Letter, if
that date is earlier than December 31, 2014, inclusive.
|
|
7.
|
“U.S.
person” has the same meaning as in the FATCA Agreement.
|
|
8.
|
“Entity”
has the same meaning as in the FATCA Agreement.
|
|
9.
|
“U.S.
Related Accounts” means accounts which exceeded $50,000 in value at any
time during the Applicable Period, as measured by the account balance on
the last day of each month during the Applicable Period, and as to which
indicia exist that a U.S. Person or Entity has or had a financial or
beneficial interest in, ownership of, or signature authority (whether
direct or indirect) or other authority (including authority to withdraw
funds; to make investment decisions; to receive account statements, trade
confirmations, or other account information; or to receive advice or
solicitations) over the account, as determined by applying the due
diligence procedures applicable to “Lower Value Accounts” in the FATCA
Agreement, Annex I, Part II, for accounts with $250,000 or less in value
at all times during the Applicable Period, and by applying the due
diligence procedures applicable to “High-Value Accounts” in the FATCA
Agreement, Annex I, Part II, for accounts with more than $250,000 in
value at any time during the Applicable Period, notwithstanding the
amounts and dates set out in the FATCA Agreement, Annex I, Part II.
|
|
10.
|
“Independent
Examiner” means a qualified independent attorney or accountant; the Tax
Division reserves the right to object to a particular attorney or
accountant, but will not unreasonably withhold approval.
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|
11.
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“Non-Target
Letter” means a letter from the Tax Division stating that, as of the date
of the letter and based upon information then known to the Tax Division,
the Swiss Bank to which the letter is addressed is not the target of a
criminal investigation authorized by the Tax Division for violations of
any tax-related offenses under Titles 18 or 26, United States Code, or
for any unreported monetary transactions under §§5314 or 5322, Title 31,
United States Code, in connection with undeclared U.S. Related Accounts
held by the Swiss Bank during the Applicable Period.
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II. Swiss Banks Requesting A Non-Prosecution Agreement
(Category 2 Banks)
A. Any
Swiss Bank
|
1.
|
as
to which the Tax Division has not authorized a formal criminal
investigation concerning its operations as of August 29, 2013 (i.e., that
is not a Category 1 Bank);
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|
2.
|
that
is not a Category 4 Bank; and
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|
3.
|
that
has reason to believe it may have committed tax-related offenses under
Titles 18 or 26, United States Code, or monetary transactions offenses
under §§5314 or 5322, Title 31, United States Code, in connection with
undeclared U.S. Related Accounts held by the Swiss Bank during the
Applicable Period,
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may request
a Non-Prosecution Agreement (“NPA”) on the terms set out in Paragraphs II.B
through K, below.
B. Each
Swiss Bank requesting an NPA must provide a letter to the Tax Division,
expressing its intent, no later than December 31, 2013. The letter must:
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1.
|
include
a plan for complying with the requirements set out herein, within a
reasonable time, but not to exceed 120 days from the date of the letter
of intent;
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|
2.
|
provide
the identity and qualifications of the Independent Examiner;
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|
3.
|
state
that the Swiss Bank will maintain all records required for compliance
with the terms of an NPA as set out in this Program, including all
records that may be sought by treaty requests; and
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4.
|
state
that the Swiss Bank agrees that with respect to any applicable statute of
limitations that has not expired as of the date of the announcement of
this Program, the Bank waives any potential defense based on the statute
of limitations for the period from the date of the announcement of this
Program to the issuance of an NPA or a DPA.
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If such
Bank is not able to comply with the requirements set out in this Program
within 120 days from the date of the letter of intent, the Tax Division
will grant a one-time extension of 60 days upon a showing of good cause.
C. If the
Tax Division concludes that a Swiss Bank has met all obligations set forth
in the NPA, the Department will not prosecute the Swiss Bank for any
tax-related offenses under Titles 18 or 26, United States Code, or for any
unreported monetary transactions under §§5314 or 5322, Title 31, United
States Code, in connection with undeclared U.S. Related Accounts held by
the Swiss Bank during the Applicable Period.
D. Each
Swiss Bank requesting an NPA must fully cooperate in the disclosure of the
following evidence and information.
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1.
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Prior
to the execution of an NPA, the Swiss Bank must provide information
including:
|
a.
|
how
the cross-border business for U.S. Related Accounts was structured,
operated, and supervised (including internal reporting and other
communications with and among management);
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|
b.
|
the
name and function of the individuals who structured, operated, or
supervised the cross-border business for U.S. Related Accounts during
the Applicable Period;
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c.
|
how
the Swiss Bank attracted and serviced account holders;
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d.
|
an
in-person presentation and documentation, properly translated,
supporting the disclosure of the above information, as well as
cooperation and assistance with further explanation of information and
materials so presented, upon request, or production of additional
explanatory materials as needed; and
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e.
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the
total number of U.S. Related Accounts and the maximum dollar value, in
the aggregate, of the U.S. Related Accounts that:
|
i.
|
existed
on August 1, 2008;
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ii.
|
were
opened between August 1, 2008, and February 28, 2009; and
|
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iii.
|
were
opened after February 28, 2009.
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2.
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Upon
execution of an NPA, for all U.S. Related Accounts that were closed
during the Applicable Period, the Swiss Bank must provide information
including:
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a.
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the
total number of accounts; and
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b.
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as
to each account:
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i.
|
the
maximum value, in dollars, of each account, during the Applicable
Period;
|
|
ii.
|
the
number of U.S. persons or entities affiliated or potentially
affiliated with each account, and further noting the nature of the
relationship to the account of each such U.S. person or entity or
potential U.S. person or entity (e.g., a financial interest,
beneficial interest, ownership, or signature authority, whether
directly or indirectly, or other authority);
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iii.
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whether
it was held in the name of an individual or an entity;
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iv.
|
whether
it held U.S. securities at any time during the Applicable Period;
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|
v.
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the
name and function of any relationship manager, client advisor, asset
manager, financial advisor, trustee, fiduciary, nominee, attorney,
accountant, or other individual or entity functioning in a similar
capacity known by the Bank to be affiliated with said account at any
time during the Applicable Period; and
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vi.
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information
concerning the transfer of funds into and out of the account during
the Applicable Period on a monthly basis, including (a) whether funds
were deposited or withdrawn in cash; (b) whether funds were
transferred through an intermediary (including but not limited to an
asset manager, financial advisor, trustee, fiduciary, nominee,
attorney, accountant, or other third party functioning in a similar
capacity) and the name and function of any such intermediary; (c)
identification of any financial institution and domicile of any
financial institution that transferred funds into or received funds
from the account; and (d) any country to or from which funds were
transferred.
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3.
|
Prior
to the execution of an NPA, the Swiss Bank will, at its expense, have the
information described in Paragraph II.D.2, above, verified by an
Independent Examiner. The verification will include a statement that the
Independent Examiner has confirmed that the due diligence standards set
out in Paragraph I.B.9, above, were applied in collecting the information
described in Paragraph II.D.2, above.
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|
4.
|
As
a condition of any NPA, the Swiss Bank will provide all necessary
information for the United States to draft treaty requests to seek
account information; such cooperation will include but not be limited to
the development of appropriate search criteria.
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|
5.
|
As
a condition of any NPA, the Swiss Bank will collect and maintain all
records that are potentially responsive to such treaty requests to
facilitate prompt responses.
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E.
Retention of records
The terms
of an NPA will include that the Swiss Bank agrees to retain all records
relating to its U.S. cross-border business, including records relating to
all U.S. Related Accounts closed during the Applicable Period, for a period
of 10 years from the termination date of the NPA.
F.
Assistance in Related Matters
The terms
of an NPA will include that the Swiss Bank, upon request, will provide:
|
1.
|
testimony
of a competent witness or information as needed to enable the United
States to use the information and evidence obtained pursuant to a
provision of this Program or separate treaty request in any criminal or
other proceeding; and
|
|
2.
|
assistance
in identification and translation of significant documents at the expense
of the Swiss Bank.
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G. Closure
of Accounts of Recalcitrant Account Holders
The terms
of an NPA will provide that the Swiss Bank agrees to close any and all
accounts of recalcitrant account holders, as defined in Section 1471(d)(6) of the U.S. Internal Revenue Code.
The terms of the NPA will require that the Swiss Bank implement procedures
to prevent its employees from assisting recalcitrant account holders to
engage in acts of further concealment in connection with closing any account
or transferring any funds. The terms of the NPA will also provide that the
Swiss Bank agrees not to open any U.S. Related Accounts (as defined in
Paragraph I.B.9, above, but without regard to the dollar limit or the
reference to the Applicable Period) except on conditions that ensure that
the account will be declared to the United States and will be subject to
disclosure by the Swiss Bank.
H. Payment
Upon
execution of an NPA, the Swiss Bank will agree to pay as a penalty:
|
1.
|
for
U.S. Related Accounts that existed on August 1, 2008, an amount equal to
20% of the maximum aggregate dollar value of all such accounts during the
Applicable Period;
|
|
2.
|
for
U.S. Related Accounts that were opened between August 1,2008, and
February 28, 2009, an amount equal to 30% of the maximum aggregate dollar
value of all such accounts; and
|
|
3.
|
for
U.S. Related Accounts that were opened after February 28, 2009, an amount
equal to 50% of the maximum aggregate value of all such accounts.
|
The
determination of the maximum dollar value of the aggregated U.S. Related
Accounts may be reduced by the dollar value of each account as to which the
Swiss Bank demonstrates, to the satisfaction of the Tax Division, was not
an undeclared account, was disclosed by the Swiss Bank to the U.S. Internal
Revenue Service, or was disclosed to the U.S. Internal Revenue Service
through an announced Offshore Voluntary Disclosure Program or Initiative
following notification by the Swiss Bank of such a program or initiative
and prior to the execution of the NPA.
I. This
Program sets out the framework for the proposed NPAs. Each NPA may take
into account factors specific to the particular Swiss Bank.
J. If the
Department determines, in its sole discretion, that any information or
evidence provided by the Swiss Bank is materially false, incomplete, or
misleading, it may decline to enter into an NPA; or if after entering into
an NPA, the Department, in its sole discretion, determines that the Swiss
Bank has provided materially false, incomplete, or misleading information
or evidence, or has otherwise materially violated the terms of the NPA, the
United States may pursue any and all legal remedies available to it,
including investigating and instituting criminal charges against the Swiss
Bank, without regard to any other provision of the NPA or this Program. For
purposes of this provision, by executing the NPA, the Swiss Bank will agree
that any prosecutions under statutes included in Paragraph II.C, above,
that are not time-barred by the applicable statute of limitations on the
date of the announcement of the Program may be commenced against the Swiss
Bank, and the Swiss Bank will agree to waive any defenses premised upon the
expiration of the statute of limitations, as well as any constitutional,
statutory, or other claim concerning pre-indictment delay, and will agree
that such waiver is knowing, voluntary, and in express reliance upon the
advice of the Swiss Bank's counsel.
K. If the
Tax Division determines, upon review of the information provided by a Swiss
Bank under Paragraph II.D, above, or other information available to the Tax
Division, that the Swiss Bank's conduct demonstrates extraordinary culpability,
the Tax Division reserves the right to require that the Swiss Bank enter a
Deferred Prosecution Agreement (“DPA”) instead of an NPA.
III. Swiss Banks Requesting A Non-Target Letter As A Category
3 Bank
|
A.
|
Any
Swiss Bank
|
1.
|
as
to which the Tax Division has not authorized a formal criminal
investigation concerning its operations as of the date of this Program
(i.e., that is not a Category 1 Bank);
|
|
2.
|
that
is not a Category 4 Bank; and
|
|
3.
|
that
has not committed any tax-related offenses under Titles 18 or 26,
United States Code, or monetary transactions offenses under §§5314 or
5322, Title 31, United States Code, in connection with undeclared U.S.
Related Accounts held by the Swiss Bank during the Applicable Period
(i.e., that is not a Category 2 Bank),
|
may
request a Non-Target Letter on the terms set out in Paragraphs III.B
through H, below.
|
|
B.
|
Each
Swiss Bank requesting a Non-Target Letter as a Category 3 Bank must
provide a letter to the Tax Division, expressing its intent no earlier
than July 1, 2014 and no later than October 31, 2014. The letter must:
|
1.
|
include
a plan for complying with the requirements set out herein, within a
reasonable time, but not to exceed 120 days from the date of the letter
of intent;
|
|
2.
|
provide
the identity and qualifications of the Independent Examiner;
|
|
3.
|
state
that the Swiss Bank will maintain all records required for compliance
with the terms set out below; and
|
|
4.
|
state
that the Swiss Bank agrees that with respect to any applicable statute
of limitations that has not expired as of the date of the announcement
of this Program, the Bank waives any potential defense based on the
statute of limitations for the period from the date of the announcement
of this Program to the issuance of a Non-Target Letter.
|
|
|
C.
|
If
a Swiss Bank, after having undertaken an investigation in a timely and
good faith manner, belatedly determines, based on the discovery of
information that in good faith could not have been discovered previously,
that it should instead have requested an NPA as a Category 2 Bank, the
Tax Division may consider whether to enter into discussions with the
Swiss Bank as if the Swiss Bank had timely requested an NPA under the
terms of Paragraph II, above. A request for relief under this provision
must be made before October 31, 2014. Relief will be granted at the sole
discretion of the Tax Division, and only under extraordinary
circumstances. Under no circumstances will such relief be considered if
the Tax Division has authorized a formal criminal investigation concerning
the operations of the Swiss Bank, or has received information concerning
wrongful conduct by the Swiss Bank.
|
|
D.
|
A
Swiss Bank requesting a Non-Target Letter under Paragraph III.B, above,
must, at its expense, engage an Independent Examiner to conduct an
independent internal investigation.
|
|
E.
|
At
the conclusion of the independent internal investigation, the Swiss Bank
and the Independent Examiner must:
|
1.
|
verify
the percent of the Swiss Bank's account holdings and assets under
management that are U.S. Related Accounts;
|
|
2.
|
verify
that the Swiss Bank has an effective compliance program, accompanied by
a description of the compliance program; and
|
|
3.
|
provide
the Tax Division with a report of the Independent Examiner's internal
investigation, prepared in English, that includes: (i) a list of the
witnesses, including titles, interviewed by the Independent Examiner
and a summary of the information provided by each witness; (ii)
identification of the files reviewed by the Independent Examiner; (iii)
the factual findings of the Independent Examiner; and (iv) the
conclusions reached by the Independent Examiner.
|
|
|
F.
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A
Swiss Bank requesting a Non-Target Letter under Paragraph III.B, above,
must agree:
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1.
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to
maintain all notes, drafts, correspondence, reports, and other
documents or records created or prepared in any manner by the
Independent Examiner, or reviewed by or provided to the Independent
Examiner, for a period of ten years from the date of the Non-Target
Letter;
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2.
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to
close any and all accounts of recalcitrant account holders, as defined
in Section 1471(d)(6) of the U.S. Internal Revenue
Code, and to implement procedures to prevent its employees from
assisting recalcitrant account holders to engage in acts of further
concealment in connection with closing any account or transferring any
funds; |
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3.
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not
to open any U.S. Related Accounts (as defined in Paragraph I.B.9,
above, but without regard to the dollar limit or the reference to the
Applicable Period) except on conditions that will ensure that the
account will be declared to the United States and will be subject to
disclosure by the Swiss Bank; and
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4.
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that,
if the Department, in its sole discretion, determines that the Swiss
Bank has provided materially false, incomplete, or misleading
information or evidence to the United States, or has otherwise
materially violated the terms of any agreement with the United States,
the United States may pursue any and all legal remedies available to
it, including investigating and instituting criminal charges against
the Swiss Bank, without regard to any other provision of the Non-Target
Letter or this Program. For purposes of this provision, the Swiss Bank
will agree that any prosecutions that are not time-barred by the
applicable statute of limitations on the date of the announcement of
the Program may be commenced against the Swiss Bank, and the Swiss Bank
will agree to waive any defenses premised upon the expiration of the
statute of limitations, as well as any constitutional, statutory, or
other claim concerning pre-indictment delay, and will agree that such
waiver is knowing, voluntary, and in express reliance upon the advice
of the Swiss Bank's counsel.
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G.
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Following
the submission of the report of an Independent Examiner's internal
investigation on the terms set out in Paragraph III.E.3, above:
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1.
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The
Tax Division may either (a) inform the Swiss Bank that the Swiss Bank
is eligible for a Non-Target Letter as a Category 3 Bank or (b) seek
additional information from the Swiss Bank prior to making its
determination. The Tax Division may decline to provide a Non-Target
Letter if the requested information is not provided.
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2.
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The
Tax Division will endeavor to provide the determination or the request
for information set out in Paragraph III.G.1, above, within a period of
270 days from receipt of the report of the Independent Examiner's
internal investigation. Should the Tax Division seek additional
information, the Tax Division will endeavor to provide a determination
within 90 days of the receipt of all such additional information. If
the Tax Division is unable to act within these time periods, the Tax
Division will provide notice to the Swiss Bank of its expectation as to
the additional time that will be needed to complete its review.
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H.
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The
Tax Division may decline to provide a Non-Target Letter to any Swiss Bank
if it determines that the Swiss Bank has failed to meet the standard set
out in Paragraph III.A.3, above, or that any information or evidence
provided by the Swiss Bank is materially false, incomplete, or
misleading, or it has information that contradicts the verification or
report of the Independent Examiner under Paragraph III.E, above, or that
otherwise demonstrates criminal culpability by the Swiss Bank.
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IV. Swiss Banks Requesting A Non-Target Letter As A Category 4
Bank
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A.
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Any
Swiss Bank
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1.
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as
to which the Tax Division has not authorized a formal criminal
investigation concerning its operations as of the date of this Program
(i.e., that is not a Category 1 Bank); and
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2.
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that
is a “Deemed Compliant Financial Institution” as a “Financial
Institution with Local Client Base” under the FATCA Agreement, Annex II
Paragraph II.A.1, as if the FATCA Agreement were in force during the
Applicable Period (except that the Swiss Bank must meet the terms of
Annex II, Paragraph II.A.1.e on December 31, 2009, and the date of the
announcement of this Program),
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may
request a Non-Target Letter on the terms set out in Paragraphs IV.B
through E, below.
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B.
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A
Swiss Bank requesting a Non-Target Letter as a Category 4 Bank must
provide a letter to the Tax Division, expressing its intent no earlier
than July 1, 2014 and no later than October 31, 2014. The letter must:
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1.
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include
a plan for complying with the requirements set out herein, within a
reasonable time, but not to exceed 120 days from the date of the letter
of intent;
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2.
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provide
the identity and qualifications of the Independent Examiner;
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3.
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state
that the Swiss Bank will maintain all records required for compliance
with the terms set out below; and
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4.
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state
that the Swiss Bank agrees that with respect to any applicable statute
of limitations that has not expired as of the date of the announcement
of this Program, the Bank waives any potential defense based on the
statute of limitations for the period from the date of the announcement
of this Program to the issuance of a Non-Target Letter.
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C.
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To
obtain a Non-Target Letter as a Category 4 Bank, a Swiss Bank must:
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1.
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provide
verification executed by the Swiss Bank and an Independent Examiner
that it has satisfied the requirements of Paragraph IV.A, above;
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2.
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agree
to maintain records sufficient to establish the basis for verification
of its status as a Category 4 Bank for a period of ten years from the
date of the Non-Target Letter; and
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3.
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agree
that, if the Department, in its sole discretion, determines that the
Swiss Bank has provided materially false, incomplete, or misleading
information or evidence to the United States, or has otherwise
materially violated the terms of any agreement with the United States,
the United States may pursue any and all legal remedies available to
it, including investigating and instituting criminal charges against
the Swiss Bank, without regard to any other provision of the Non-Target
Letter or this Program. For purposes of this provision, the Swiss Bank
will agree that any prosecutions that are not time-barred by the
applicable statute of limitations on the date of the announcement of
the Program may be commenced against the Swiss Bank, and the Swiss Bank
will agree to waive any defenses premised upon the expiration of the
statute of limitations, as well as any constitutional, statutory, or
other claim concerning pre-indictment delay, and will agree that such
waiver is knowing, voluntary, and in express reliance upon the advice
of the Swiss Bank's counsel.
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D.
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Upon
acceptance of verification of a Swiss Bank's status as a Category 4 Bank
by the Tax Division, and the agreement by the Swiss Bank to the terms set
out in Paragraph IV.C, above, the Tax Division will provide the Swiss
Bank with a Non-Target Letter.
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E.
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The
Tax Division may decline to provide a Non-Target Letter if it determines
that any information or evidence provided by the Swiss Bank is materially
false, incomplete, or misleading, or if it has evidence that contradicts
the verification of the Independent Examiner under Paragraph IV.C, above,
or otherwise demonstrates criminal culpability by the Swiss Bank.
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V. Other Provisions
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A.
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The
Tax Division will not authorize formal criminal investigation of any
additional Swiss Banks in connection with undeclared U.S. Related
Accounts held by the Swiss Bank during the Applicable Period before
January 1, 2014.
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B.
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The
personal data provided by the Swiss Banks under this Program will be used
and disclosed only for purposes of law enforcement (which may include
regulatory action) in the United States or as otherwise permitted by U.S.
law.
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C.
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This
Program is conditioned on the intention of Switzerland, as stated in the
Joint Statement between the U.S. Department of Justice and the Swiss
Federal Department of Finance dated August 29, 2013, to encourage Swiss
Banks to consider participation in the Program. Should Switzerland fail
to provide or act to withdraw such encouragement, or should legal
barriers prevent effective participation by the Swiss Banks on the terms
set out in this Program, this Program may be terminated by the
Department.
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Announced
on August 29, 2013.
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References to the
FATCA Agreement are for definitional purposes only and apply for the
purpose of this Program without regard to any subsequent amendments to
the FATCA Agreement and regardless of whether or when the FATCA Agreement
is ratified or becomes effective.
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