Geneva Banks Feel Hopeful for 2018Offshore Account Update
Posted on October 27, 2017 | Share
Since the great recession, many investors have turned for help to a New Jersey international tax attorney because they were facing legal complications associated with offshore accounts.
The U.S. government has been aggressively going after alleged tax evaders in an effort to recapture lost revenue. In many cases, those who have offshore accounts and who are being subject to IRS investigations were unaware of specific requirements associated with reporting their funds held in foreign financial institutions. Yet, they can still face serious penalties. Attorneys can provide assistance exploring programs like the Offshore Voluntary Disclosure Program (OVDP), which can reduce costs dramatically for those who voluntarily disclose that they previously broke the rules for offshore accounts.
It’s not just offshore investors who have been facing crackdowns. Financial institutions have as well, particularly banks in Geneva and throughout Switzerland. While Swiss banks have had a bad time of it these past few years, their outlook going into 2018 is far rosier than it has been in the past, suggesting that many Swiss banks may believe the worst is over.
Swiss Banks Have Higher Hopes for 2018
Swiss banks once enjoyed a world-renowned reputation for privacy, security and client services. The reputations of these respected financial institutions were tarnished, however, after the great recession when the United States and other countries began cracking down on Geneva banks for their role in facilitating tax evasion.
The fallout from investigations and accusations against Swiss banks has been profound. The number of banks in Geneva now stands at 104, which is 25 percent fewer financial institutions than there were in Geneva in 2011. Financial institutions were so devastated by the damage to their reputation that they pushed for regulatory reforms which are expected to come into force by 2019.
Geneva based banks have unsurprisingly not been positive in recent years in light of the crackdowns for tax evasion and the resulting damage to their industry. However, Reuters reports that the forecast for the upcoming year shows most Swiss banks believe the worst is over and that things are looking up from here.
When asked about how they expected their 2017 year to go, just eight percent of banks had been positive about the outlook for the year while 42% of Geneva-based financial institutions had indicated they expected a difficult year. But, the fears of these financial institutions did not materialize and once the year was coming to an end, 36 percent of Swiss banks said that 2017 had been a good year and nine percent said that it had been a very good year.
The fact that 2017 outperformed the expectations of many banks has prompted financial institutions to feel much better about 2018. In fact, 45 percent of big banks with 200 or more employees in Geneva indicated they thought 2018 would be a good year while the remainder of the banks were split between expecting a stable year and expecting a difficult year.
It remains to be seen if banks have as good a year as they expected. If crackdowns on tax evaders continue and more Swiss banks come under investigation, the mood could sour quickly.
Taxpayers should also be aware of whether regulatory crackdowns on Swiss banks have been reduced or whether crackdowns are picking up again. This is important for offshore investors because when banks are accused of tax evasion they often make deals with the government to limit their own penalties in exchange for providing accountholder information. If you suspect your account info might be turned over to the government, you should talk with New Jersey international tax attorney Kevin Thorn today about your options.