The Swiss financial markets regulator FINMA was right to order the handing over of client data by UBS to the U.S. authorities, a top court ruled on Friday, despite the country’s cherished tradition of bank secrecy.
FINMA ordered UBS to hand over the data of 255 customers to the U.S. Department of Justice in 2009 as part of a settlement to avert criminal charges being leveled against Switzerland’s biggest bank.
“Such an indictment would have led to the bankruptcy of the bank which in turn would have caused serious and virtually uncontrollable economic repercussions for Switzerland,” the Swiss Federal Supreme Court said in a statement.
“Since FINMA had compelling reasons to believe that not relinquishing the customer data to the U.S. Department of Justice would have seriously impaired Switzerland’s financial markets and have led to serious repercussions for the Swiss economy, the action taken by it was shown to be lawful.”
The ruling overturns a 2010 decision by the Swiss Federal Administrative Court that FINMA’s decision was unlawful in a case brought by UBS customers whose data was handed over. If the Supreme Court had upheld that ruling, UBS clients could have sought damages from the Swiss state.
UBS also paid a fine of $780 million in exchange for the dropping of the U.S. investigation and later handed over details of a further 4,450 accounts to settle the case.
Earlier on Friday local rival Credit Suisse said it is being probed by the U.S. Department of Justice as part of a broader investigation into banks suspected of helping Americans evade taxes.
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