UBS under new tax evasion investigation in US
Swiss banking giant UBS has confirmed it is being investigated by US authorities into whether it helped Americans evade taxes through investments banned in the US.
According to the bank, US regulators were investigating potential sales of so called “bearer bonds”.
These bonds can be transferred without registering ownership, enabling wealthy clients to potentially hide assets.
“We are cooperating with the authorities in these investigations,” USB said.
The fresh investigation by the US Attorney’s Office for the Eastern District of New York and from the US Securities and Exchange Commission comes after UBS paid $780 million in 2009 to settle a separate Justice Department tax-evasion probe.
The move comes as authorities in a range of countries are considering examining HSBC’s actions in helping more than 100,000 wealthy individuals avoid paying tax.
UBS made the announcement as it revealed a better-than-expected 13% rise in fourth quarter net profit to 963 million Swiss francs.
However, it warned the increased value of the Swiss franc relative to other currencies, following the Swiss National Bank’s decision to abandon the cap on the currency’s value against the euro, would “put pressure” on its profitability.
“The increased value of the Swiss franc relative to other currencies, especially the US dollar and the euro, and negative interest rates in the eurozone and Switzerland will put pressure on our profitability and, if they persist, on some of our targeted performance levels,” it warned.
UBS results for the full year, were hit by more than $1 billion to settle past scandals. In November, it was one of six banks fined by UK and US regulators over their traders’ attempted manipulation of foreign exchange rates, paying 774 million Swiss francs in total.
It also paid $300 million in the second quarter to settle charges it helped wealthy German clients evade tax.
The Department of Justice (DOJ) is continuing to investigate UBS over currency manipulation allegations.
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