Julius Baer Has Agreement in Principle in U.S. Tax Probe
30 December 2015 - 7:00PM
Dow Jones News
ZURICH—Julius Baer Group AG said it has reached an "agreement in
principle" with U.S. authorities to settle a long-standing probe of
the Swiss bank's alleged aiding of American tax evasion.
Zurich-based Julius Baer said Wednesday that based on its new
agreement with the U.S. attorney's office for the Southern District
of New York, the bank has increased its provision for settling the
U.S. tax matter to $547 million, from the $350 million announced in
June. Julius Baer said it expects to reach a final settlement of
the matter in the first quarter of next year.
The provision will be charged to Julius Baer's financial results
for 2015, the bank said. Despite the charge, Julius Baer said it
expects to report an adjusted net profit for the year.
In 2011, Julius Baer became one of about one dozen Swiss banks
to come under U.S. criminal investigation for allegedly aiding tax
evasion by providing undeclared accounts to Americans that were
shielded by Switzerland's bank secrecy laws. Larger Zurich-based
rival Credit Suisse Group AG settled its own related probe last
year by pleading guilty to aiding U.S. tax evasion and agreeing to
pay $2.6 billion.
In May, The Wall Street Journal reported that Julius Baer was
proceeding toward a settlement with U.S. authorities, and that the
bank could face a lightened financial penalty due to a previous
effort to disclose details about its U.S. accounts to the Justice
Department in 2009. That previous effort was blocked by
Switzerland's financial regulator, Finma.
As recently as May, analysts were predicting that Julius Baer
could face a penalty of as much as $900 million. However, in June
the bank reset expectations by announcing that it was setting aside
$350 million to settle the U.S. tax issue.
Write to John Letzing at john.letzing@wsj.com
(END) Dow Jones Newswires
December 30, 2015 02:45 ET (07:45 GMT)
Copyright (c) 2015 Dow Jones & Company, Inc.
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