Off-shore Tax Havens Under Increasing Pressure to Cough Up the Names

You could have spotted this trend quite a few years ago. Momentum has now built to the stage where the U.S. government has broken out of the starting gate like that three-year old thoroughbred, California Chrome, who will be seeking the Triple Crown at the Belmont Stakes on June 7th.

The hunt for money hidden in Swiss bank accounts by U.S. citizens has become a global chase, with prosecutors tracing records to Singapore, the Cook Islands and elsewhere as U.S. authorities increase the pressure on Swiss lenders to turn over evidence, according to officials.

It was interesting a number of years ago trying to explain the danger of "hiding" money off-shore to certain people. You'd try to explain that, even if they didn't have millions stashed away, even if they just had a bank account that their parents or grandparents left them, they had to report the existence of the account or the U.S. government would come down hard on them. Since the reporting was seen as costly and time-consuming (which it really doesn't have to be), they'd brush the suggestion aside as some sort of annoyance.

The recent focus on Credit Suisse resulted from an investigation begun at least 5 years ago. In all that time, the U.S. government has gathered their evidence, negotiated with the big bank, and finally - after much back and forth - announced the results of that process

Credit Suisse, which last week pleaded guilty to conspiracy and agreed to pay $2.6 billion to settle allegations it helped wealthy Americans hide money from the Internal Revenue Service, has agreed to turn over some bank records that can help U.S. authorities track down individual account holders across the globe.

The point here isn't to say I was right. It's to say that this is only the beginning. And I suspect the end result will be to strip away any and all right to privacy.

Remember, many off-shore account holders have reported their existence. The reasons for having an account off-shore don't necessarily include wanting to hide your money from the U.S. government. They might include, however, a desire to keep your affairs private. And while that's not against the law at this point, you have to wonder whether the mere desire to protect your privacy will at some point be considered not only a prime cause of suspicion, but outright illegal, subject to criminal charges.

I hope I'm wrong about this.

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