Numbered Swiss bank account another way to hide money
On the Money
From the April 2, 2004 print edition
Last month, we listed ways to keep your money secure, avoid becoming a victim of fraud and identity theft, and ways to promptly spot problem activities. Continuing with the idea of protecting your money (we hesitate to use the word hide), no instrument has received as much recognition as the secret Numbered Swiss Bank Account.
Here are some history and facts about this mystifying symbol of wealth and prestige.
One of the earliest pieces of legislation regulating bank secrecy dates back to the 18th Century. In 1713, the Great Council of Geneva (cantonal council) adopted banking regulations which stipulated the bankers’ obligation to “keep a register of their clientele and their transactions. They are, however, prohibited from divulging this information to anyone other than the client concerned, except with the expressed agreement of the City Council”.
Until 1934, bank secrecy was regulated solely by civil law. There were no criminal provisions; that is any threat of imprisonment for the banker at fault.
Since 1934, two articles of the Swiss criminal code also enforce Swiss bank secrecy:
- Article 162 regarding disclosure of trade secrets or confidential business information. It states “Any person who has divulged a trade secret or confidential business information that was meant to be kept by virtue of legal or contractual obligation, or any person who has used this information to his or her benefit or to that of a third party, will be, on prosecution, punished by imprisonment or by fine.”
- Article 320 deals with occupational confidentiality. It says, “Any person who has divulged a secret entrusted to him or her as a representative of authority or as a civil servant, or who has acquired knowledge by means of his or her practice or employment, will be punished by imprisonment or by fine.”
Once the bank account is established, a number replaces your name on all documents in connection with your account. Only a few people at the bank know your identity. Your bank transfers are marked: “Bank X for the account of a client”.
However, numbered accounts are not anonymous: the bank always knows your identity.
The numbered account offers additional protection for private matters such as inheritance or divorce, for it is up to the plaintiff to identify the bank in which the funds are deposited before the courts can pursue the case. The plaintiff’s search is even more difficult with pseudonyms, such “The Prof,” or “Colorado-Godfather.”
What does it take to open a secret numbered account? There are two requirements..
- Minimum deposit of 100,000 Swiss Francs (“CHF”). At today’s exchange rate that’s about $78,796.50. Other forms of private (though not numbered) Swiss accounts may be opened for less.
- Set-up fee of 1,299 CHF or $1,023.56
Numbered Swiss accounts also include other services such as: credit cards, mail retaining, internet banking, online trading, investments, and opening by mail. These accounts are primarily investment accounts.
Nonetheless, there are areas where even the Swiss must open the door. For example, fraud and money laundering are not welcome. Filing bankruptcy in the United States may not protect your Swiss account from creditors. In accordance with Swiss Private International Law (1987), bank secrecy can be lifted for a bankruptcy declared abroad when the creditor’s rights have been duly established.
Because every circumstance and motivation is unique, you may want to consult some of the various legal texts that deal with Swiss bank secrecy. Swiss Federal laws that apply (more info at www.amcham.ch):
- Labor Code (RS 220), Article 398
- Swiss Criminal Code (RS 311.0), Articles 260; 305a; 305b
- Federal Act on International Mutual Assistance in Criminal Matters (RS 351.1)
- Federal Act on the Treaty with the United States of America on Mutual Legal Assistance in Criminal Matters (RS 351.93)
- Federal Banking Act (RS 952.0), Article 47
- Federal Act on Securities Exchanges and Securities Trading of 24 March 1995 (RS 954.1)
- Federal Act on the Prevention of Money Laundering in the Financial Sector of 10 October 1997 (entered into effect on 1 April 1998; RS 955.0) Switzerland has ratified these international agreements (again more info atwww.amcham.ch):
- European Convention on Mutual Assistance in Criminal Matters of 20 April 1959 (RS 0.351.1)
- Convention of 8 November 1990 on Laundering, Search, Seizure and Confiscation of the Proceeds from Crime (RS 0.311.53)
- International judicial cooperation treaties (RS 0.351 et seq.)
Of course without implying that any of these people actually have Numbered Swiss Accounts, you too could join the ranks of Roger Moore, David Niven, Tina Turner, and Shania Twain; all now living in Switzerland. As we say, “Ici vous souhaite l’énorme prospérité anonyme !” (“Here’s wishing you enormous anonymous prosperity!”)
© C. Stephen Guyer for American City Business Journals Inc. All rights reserved.