INTRODUCTION
Opening a Swiss bank account in the internet age is a very easy thing to do. The main reason for opening a Swiss bank account is for the extreme security and privacy Swiss Banks uphold thanks to Swiss laws that have been in effect for over 75 years. Contrary to popular belief, opening a Swiss bank account does not always mean that you are a tax evader, criminal, or money launderer.
Swiss bank accounts can protect one’s money from prying relatives, nasty divorce settlements, lawsuits, and more. Some people just want a Swiss bank account because of the allure and mystery often attached to Swiss bank accounts, but whatever your reasons it is relatively easy to find a bank and open an account.
You’ll want to start your search online and be sure to look for trusted and well known Swiss banks. UBS and Credit Suisse are two of the largest Swiss banks and have sprawling international networks available. Many Swiss banks like most banks these days will allow you to set up and open an account online securely. The initial deposits may be higher for some accounts and some accounts may come with annual fees. Obviously you’ll need to have an existing account through which to transfer money to your new Swiss bank account with.
10 years ago opening a Swiss bank account may have included visiting the bank of your choice in person, paying hundreds of dollars a year in fees, and putting down a few thousand dollars as an initial deposit. As the internet has allowed online banking to explode, you can now open a bank account at thousands of banks around the world wherever you are. Offshore bank accounts are available to anyone with money that needs a place to be kept, Swiss banks have a lot of competition these days. Sticking to trusted and insured banks is always the way to go. While most banks today have secure online banking and security features in place, a Swiss bank account comes built in with some of the strictest privacy laws in the world.
Never wire money or deposit money to any site or bank without first verifying that the bank or site is secure and licensed to do banking. Making sure deposits are insured is also a good idea and be mindful that not all banks may be insured or may have deposit insurance limits. Read reviews and ask questions about the Swiss bank you choose before providing any personal information. Once you’ve found a good Swiss bank and open an account you’ll enjoy financial privacy at a level found only in Switzerland.
In 1934, the Swiss passed a law that made it a criminal offense for bankers to reveal the identity of account holders. There are two reasons why this protection was reinforced:
- Nazi spies: The 1931 crisis led to intensified foreign exchange control in Germany. Hitler promulgated a law whereby any German with foreign capital was to be punished by death, and the Gestapo began espionage on Swiss banks. When three Germans were put to death, the Swiss government was convinced of the necessity to reinforce bank secrecy.
- Pressure from the French: The 1932 Basler Handelsbank affair revealed that over 2,000 members of the French elite had accounts in Switzerland. French Leftists took advantage of this to denounce the austerity program of the government. It called for legal authority over French accounts in Switzerland, but to no avail.
Unlike American law where law enforcement agencies, the judicial system, and private citizens can gain access to all kinds of financial information, under Swiss law neither the bank’s officers or the its employees are allowed to reveal any information, relative to any account to anyone, including the Swiss government.
No private citizen, or their legal representative can ever receive any type of information about anyone’s Swiss bank account under any set of conditions. That includes all types of legal proceedings that the Swiss classify as non-criminal behavior.
The Swiss consider tax evasion a political offense. Divorce, inheritance disputes and bankruptcy cases are considered private matters, and as such the secrecy of the account is protected from any legal action to verify the presence of, or attempts to seize any assets.
There are some notable exceptions. The Swiss are bound by a treaty with the US to reveal accounts connected with organized crime, drug trafficking and insider trading. But the final say on revealing the identity of the account holder is up to the Swiss authorities. There are no US restrictions on having Swiss bank accounts, but the IRS requires you to report your foreign accounts when you file your annual income tax return. Interest earned in a foreign account is still taxable under US tax laws, but you usually get to offset foreign taxes that you may be required to pay.
7 MYTHS ABOUT SWISS BANK ACCOUNTS
- Swiss bank accounts are only for millionaires.
- Money invested in Switzerland yields no interest.
- It’s impossible to open an account in Switzerland by correspondence.
- Swiss bank accounts are very expensive to maintain.
- It is difficult to close a Swiss bank account.
- Swiss bank accounts attract only criminals and dictators.
- Numbered accounts are anonymous.
1. Swiss bank accounts are only for millionaires
This is not true. The majority of our clients are not major manufacturers or movie stars, but everyday people (business people, computer engineers, civil servants, etc.). Swiss banks are no longer only for stars.
You can open a Swiss bank account with a deposit of only 5,000 Swiss francs. We even offer accounts with no minimum balance.
2. Money invested in Switzerland yields no interest
Nothing could be more untrue. You can invest your money worldwide from your account in Switzerland through investment funds, bonds, the stock market, the purchase of metal values, raw materials, derivatives and many other types of investments. Swiss bankers are among the best finance managers in the world, so it comes as no surprise that they manage over 35% of offshore holdings.
3. It’s impossible to open an account in Switzerland by correspondence
This is not true. Most of the accounts that we offer can be opened by correspondence as long as you comply with our opening procedures and provide us with the necessary documents. What is more, your banking relations can be conducted by correspondence, using the telephone, Internet banking, bank transfer and credit cards. That said, we encourage our customers to meet with their banker at least once in order to get acquainted and see where their money is held.
4. Swiss bank accounts are very expensive to maintain
This is not true. Most of the accounts we open don’t charge a cent in annual fees. Even if you would like additional services such as retained correspondence or numbered banking relations, the annual fees are very reasonable.
5. It is difficult to close a Swiss bank account
On the contrary. You can close your account in Switzerland whenever you wish and without any restriction. You will pay no financial penalty. If need be, you will just have to realize your investments. Contrary to many onshore banking practices, your money is not held hostage by Swiss banks.
6. Swiss bank accounts attract only criminals and dictators
Not true! The vast majority of Swiss bank account holders are honest people who want to keep their savings in a country renowned for its stability. Swiss banks are extremely cautious regarding politicians who wish to open an account and they systematically refuse to accept any money that is of dubious origin or poorly founded.
7. Numbered accounts are anonymous
There are no anonymous accounts in Switzerland. A numbered account is an account that is identified solely by a number, rather than a name, in order to preserve the strictest confidentiality possible during teller transactions or bank transfers. Only the bank manager and a few select people know the identity of numbered account holders.
There are Swiss bank accounts and there are Swiss bank accounts. The first is accessible to (almost) anyone. Such an account will offer credit and debit cards, checking or whatever else you may want in a bank account. Opening such an account can be done in person–some Swiss banks have branches here in the US–or by mail. Some red tape is involved in that you have to get a signature from someone at a Swiss consulate, but not much more is required.
Then there are the Swiss bank accounts you’ve heard about from the movies. These are the numbered accounts, the ones with minimum balances anywhere from $100,000 to $1 million. It’s known as private banking and it’s reserved for folks who have a lot of assets to manage and who demand a lot of service. Many private banks require a special invitation or referral by current customers. The services you receive at a private bank focus on private counseling in aspects of wealth management including investments, tax concerns, and estate planning.
The numbered accounts aren’t anonymous, but only a few people know the name of the account holder and Swiss law forbids them from revealing it to most anyone. They can’t acknowledge that you have an account, give out the name of a numbered account holder or reveal any information about the transactions of any account holder.
Generally, numbered accounts must be opened in person, though lawyers and/or brokers can perform this service for you by mail. You’ll have to fill out a mountain of paperwork and provide details about your life and job as well as a letter of introduction from a US banker. Your signature and identity have to be authenticated by a notary public or consul, depending on circumstances.
If you’ve got the money and want to open such account, here are links to the private banking departments of some well known Swiss banks:
· UBS, The Union Bank of Switzerland
Switzerland isn’t the only place to put your assets. Banks in Anguilla, Belize, Bahamas, Cayman Islands and Panama offer similar services.
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