Secret, Offshore Bank Accounts

In a series of articles we are taking a look at offshore, secret bank accounts and how the US government crippled international banking privacy laws, and in so doing, how it single-handedly transformed world banking. Later we will take a detailed look at how that affects US citizens living and working abroad.

Secret, offshore bank accounts have been estimated to be worth over $8.5 trillion US dollars and to cost the US government between $100 billion and $250 billion every year in lost taxes. The Swiss banking industry managed to amass a financial empire estimated to be over $2 trillion US dollars, since its enactment of bank secrecy laws in 1934. It wasn’t until whistleblowers began to leak information demonstrating that Swiss banks were doing more than just acting as a repository for funds, that things began to change. The leaked information proved that they were actively involved in helping their clients hide money and evade taxes from countries all around the globe. This gave the IRS the muscle it needed to put an end to the existence of international banking privacy laws.

Any bank that assists a US individual or entity evade US tax or hide money, regardless of where that bank is located, is guilty of a felony under US law. It was the use of US criminal laws against Swiss banks that ultimately brought down the bank secrecy laws and resulted in the full transparency laws that are going into effect all around the world today.