When the world body named him a terrorist financier, the Swiss government froze his assets.
Reducing the amount of foreign assets that Swiss banks hold is sensible but privileging domestic lending so flagrantly is alarming.
At the time, prosecutors said Wegelin in 2008 and 2009 opened and serviced dozens of new accounts for U.S. taxpayers as it tried to capture clients lost by UBS after word surfaced that that UBS was being investigated for helping U.S. taxpayers evade taxes and hide assets in Swiss bank accounts.
And the industry can no longer rely on Swiss banking secrecy to attract assets.
It obtained an emergency court order to freeze assets in a Swiss-based account.
Germany's upper house of parliament has rejected a deal with Switzerland to tax German assets held in Swiss bank accounts.
This is largely due to the fact that the fees as a % of wealth management assets are much higher for Swiss clients.
Now, the other shoe has landed with a coveted John Doe Summons that will surely turn up records showing U.S. authorities who held assets at Wegelin and other Swiss institutions using the UBS account.
FORBES: Judge Gives IRS Access To More Accounts At UBS And Wegelin
Concerns over the debt ceiling debate in the U.S., along with sovereign debt woes in Europe sending peripheral debt to nearly unsustainable levels, have put pressure on risk assets across the board and sent investors fleeing for safe-haven assets like gold and the Swiss franc.
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The unexpected collective move by the U.S. Federal Reserve, the European Central Bank, the Bank of Japan, the Bank of Canada and the Swiss National Bank were bullish for risk assets as the U.S. and European stock markets, and most commodity markets, rallied on the news.
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Given that the banks' assets are many times the size of Swiss GDP, would the country have the financial strength to bail them out?
The UK government admits it may not be able to pin down who, exactly, owns all the money in Swiss banks, and also expects some of the assets to be moved.
Although many observers expect U.S. lawmakers to reach a last-minute deal to avoid defaulting on its debt, the uncertainty is prompting investors to shift assets into safe havens, like gold and the Swiss franc.
Assets: Over 4% of ABB, parent of Swiss-Swedish Asea Brown Boveri.
To help rebuild its assets, UBP bought over the past two years the Swiss arm of Dutch bank ABN AMRO, and Paris-based hedge fund Nexar Capital Group.
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Prosecutors say Lack helped U.S. clients hide assets from the IRS through accounts at UBS and another smaller Swiss Bank.
FORBES: U.S. Charges Swiss Banker For Helping Rich Americans Evade Taxes
By contrast, safe-haven currencies such as the yen and Swiss franc rocketed, while gold also benefited from a flight from riskier assets such as stocks, oil and industrial metals.
Swiss banking secrecy came under attack after the second world war when the allies asked for German assets to be handed over.
Three years later the same group is the hottest firm on the Street with client assets and brokers from rival firm flowing in, and all the while providing its struggling Swiss parent company with much needed stability.
Assets: Owns an estimated 75% of his BZ Group Holding, which has stakes in Swiss blue-chip companies like ABB, Alusuisse-Lonza, and Roche.
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