G7 Warns Switzerland Over Banking Secrecy

by Ulrika Lomas, Tax-News.com, Brussels

18 June 2002

Following a meeting of G7 finance ministers at the weekend, it was revealed that sanctions are now under consideration for those countries which fail to comply with international initiatives seeking to counter money laundering, tax evasion, and terrorist financing.

Speaking at a news conference on Saturday, German Finance Minister, Hans Eichel announced that: 'We expect to see visible progress in this area this year and we are ready to think about sanctions this autumn if we see no results.'

He added that some OECD member states 'needed to do some catching up'. Although no countries were specifically named, Reuters revealed that this remark almost certainly referred to Switzerland, which has also come under the European Union's spotlight for refusing to lift banking secrecy in connection with the EU's Savings Tax Directive.

British Finance Minister, Gordon Brown echoed Mr Eichel's words at the weekend. Speaking following the two-day meeting held in Halifax, Canada, he stressed that the G7 ministers are determined to: 'move forward quickly to achieve effective exchange of information to end banking secrecy that would prevent us being able to deal with money laundering, tax evasion, and the finance of terrorism'.

He added that: 'It is our determination that countries outside this are shown to be isolated from the international community.'

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