I called GE Money Bank AG today and was informed that they do not provide banking services to Swiss citizens in Switzerland who are considered to be “US Persons”. GE Money Bank is a division of GE Capital which is a unit of General Electric, “an American multinational conglomerate corporation incorporated in Schenectady, New York and headquartered in Fairfield, Connecticut, United States”.[1]
You are hereby confirming that you are a non-US person, i.e. that you are not a US citizen (sole, double or multiple nationality), that you do not possess resident alien status (for example because you are in possession of a Green Card or because you have regularly resided in the USA in the current year and the previous two years) and that in accordance with the provisions of US tax law you are the beneficial owner of the assets held by you and of the income generated by those assets. Insofar as a double taxation treaty exists between the USA and your country of domicile as a client, the bank will in principle accord you, as our client, a reduction of the US withholding taxes on income from US sources. In such a case, the bank is entitled to ask you to produce additional documentation.
GE Money Bank Savings (see info button to the right of “confirm that I am a non-US person.”)
Other banks that I have called so far who refuse to provide banking services to Swiss citizens in Switzerland considered as being “US Persons” are:
- GE Money Bank (US bank. Doesn’t finance mortgages, but refuses to provide banking services to Americans)
- Raiffeisen (might finance Swiss citizens who live in the States)
- Bank Coop
- AXA Bank
- Migros Bank (unless the minimum account balance is $250’000 or the mortgage is above $700’000)
- NAB
- Valiant Bank AG
- Rothschild Bank AG (probably not, but unsure)
- SwissLife (investment products, mortgages)
- Hypothekarbank Lenzburg (see signature on every web page)
- Swissquote Bank
- FinanzZentrum Jungfrau AG
- Vontobel (Doesn’t finance mortgages, but US persons are prohibited from accessing the web page)
- Bank Sarasin, under the condition that the mortgage is matched with assets (US persons are prohibited from accessing the web page)
Banks which are stated that they were undecided are:
- Bank Thalwil (as of 28.08.2012, but US persons are prohibited from visiting their web site)
- Bank Linth (conditional, but their web site states that investments and other transactions are not for US persons)
- Alpha Rheintal Bank AG (only accepts regional customers, including maybe US persons)
- Julius Baer (refuses to provide financial services to US citizens, but I need to inquire on mortgages with dual citizens)
Banks which provide Swiss citizens in Switzerland banking services regardless of the fact that they are considered as being “US Persons” are:
- Basler Cantonal Bank (refuses to provide financial services to US citizens)
- Vaud Cantonal Bank (waives foreign account fees for Swiss citizens living or working abroad)
- Aargauische Cantonal Bank (closing the accounts of US persons)
- St. Galler Cantonal Bank (closing the accounts of US residents)
- Zürcher Cantonal Bank (does not finance mortgages for Swiss citizens who live in the US)
- Credit Suisse (refuses to provide financial services to US citizens)
- Hyposwiss Privatbank (As long as W9 is completed)
- UBS (Baden branch, but American citizens are being denied banking services)
- Postfinance (does not provide credit to Swiss citizens living in America). It’s partners, Valiant and Münchener Hypothekenbank don’t want US persons.
- SwissLife (insurances)
- AMFIE (according to CERN)
- Credit Mutuel in St. Genis-Pouilly (according to CERN)
Those denying banking services to Swiss citizens have no official statement of such. They are acting upon recent internal instructions which they will not release to the public. I was told that SwissLife has an official statement on the matter, and I found one on a mortgage application:
The customer is not a “US-Person”. That means, he/she is not a US citizen (single, double or multiple citizenship), that he doesn’t have the status of being a foreign resident (“resident alien”) , has (for example the possession of a “Green Card” or any regular stay in the USA in the current year or last two years).
SwissLife Mortgage Application
Both the US embassy in Bern and the Swiss Department of Finance stated that the action taken by the banks is legal and advised one to communicate the matter with US representation. After being informed that US politicians are not responding to Americans abroad, the US embassy in Bern recommended contacting the ACA lobby.
The US government writes that it is a federal crime to deny a US person a mortgage because of their national origin, and yet the US government is forcing this federal crime upon US citizens as a result of citizenship-based taxation.
Thanks for posting this. Perhaps we should start a “Name and Shame” list and keep it as a sticky.
Good to see a few are not refusing – guess UBS has nothing to lose at this point, eh? 😉
*And under US Federal Equal Opportunity in Hiring laws it is a federal crime to discrimininate in employment based on national origin, or to in any way discriminate in compensation based on this same factor.
I understand this kind of discrimintation had been determined by the courts to apply only to American employers and their hiring practices in the the United States, so it is not surprising that GE would not be bound by any of these US anti-discrimination laws with respect to its operatons outside of the United States.
But it is certainly ironic that our Federal tax laws in effect obligate companies, banks and employers with laws similiar to our own to violate their own laws if they are willing to compensate US citizens additionally so they can survive the double taxation imposed on US persons living and working in a different country. It is a clear case of a double standard. What is illegal in the US is not considered to be objectionable if it involves US citizens in a foreign country. The excuse is that the US does not involve itself in the internal policies of other countries.
But it does not hesitate in violating the sovereignty of other countries by levying and collecting US taxes from US persons who live and work in those countries, and in obligating financial institutions, under the threat of severe US penalties, in those countries to violate the privacy laws of those countries by revealing confidential banking information to the IRS on US persons with accounts in those countries.
swisspinoy: fine work!
Aargauische Kantonalbank plans to separate from all American customers by the end of 2012:
http://www.aargauerzeitung.ch/aargau/kanton-aargau/die-akb-will-bis-ende-jahr-alle-amerikanischen-kunden-los-werden-120877084
A regional real estate broker advised last week that UBS and Credit Suisse were still granting mortgages to Americans but that NAB and Raiffeisen had stopped (those were the banks he had contacted). His opinion: 1) UBS and Credit Suisse are already in the “Strudel” with the US tax authorities so they are not increasing their risk; 2) UBS and Credit Suisse have the systems and competence to deal with the complex regulations and Rechtsunsicherheit, which the regional banks do not.
I support your pressure on the US Embassy in Bern which cannot hurt.
“All the other Swiss banks will follow sooner or later and cut their relations with their US customers”. AKB
I haven’t heard of anyone in Canada being denied services. Yet.
@Innocente, swisspinoy
If you listen closely to Mr. Dellenbach in the video from the link you posted, he is clearly refering to clients that are living in the US and are not or no longer resident in Switzerland. This video is from Frebruaury though so I’m not sure what the policy of the AKB is nowadays.
I’m on vacation next week and my wife will be visiting her parents with the kids for a few days so I’ll try to get first hand information from UBS, Raiffeisen, Coop, AKB and Postfinance concernig this issue and post my findings here.
@swisspinoy
Maybe we can enjoy a cool beer together im Muellerbrau’s Biergarten hinter em bahnhof am aerschte Augschta 😉
*As far as I know UBS branches anywhere in Switzerland will at least consider US citizens. We recently were approved for our mortgage at our local branch near Fribourg, although he had to check with, presumably, someone else who deals with US matters on the bank’s behalf when he found out I was a dual national.
As Innocente says, the big two are already having to deal with US and are more likely to look favourably on US citizens. Still, I’m wondering what will happen when they get round to asking if we’re US tax compliant and the answer is no. I’m afraid/fear the answer will be bye, bye, it’s been good to know you, but we don’t want you anymore.
Swiss Post Office is also still taking US citizens for those who might be looking to find someone to grant them a bank account.
*@Medea,
If you have been accepted by UBS for a mortgage and they know you are a US citizen you can rest assured that your name and account information will be included in the information UBS delivers to the Swiss Government for transmittal to the IRS. Chances are that now that the IRS knows where you, as a US citizen are locacted, you will be hearing directly from them about your compliance with US tax filing requirements and your current compliance status. I wish you the best and sincerely hope for your sake that you have not tripped the tax trap.
@Medea, Migros and NAB informed me that the situation concerning US Persons is undefined and always changing. Today it is this, tomorrow it may be that. With UBS, the situation is a bit better established. I was told that all US persons are sent to the Baden Branch which is the UBS branch for US Persons (maybe around greater Zürich). Everything there is open to the IRS, all the advisers have been trained on US matters and the banking conditions are said to be fair. It actually sounds kind of cool, except for the simple fact that I would rather be a local than one of “them”.
I’ve honestly had it with being a “US Person”. I can tolerate a bunch of things, but refusing to refinance my mortgage under such conditions is unacceptable. The only reason why I’m being somewhat civil is because I write under the name of “SwissPinoy” and the only reason why I’m not renouncing/relinquishing is because non-US persons advised me to hang on a bit longer, maybe because they figure that the best change to a flawed system comes from within.
@UncleTell, that would be great, but my family and some locals already reserved the day, making it unlikely that I’d have time to arrange a trip to Muellerbrau’s. If you like, we can schedule in another day and you can get my email address from Petros.
@Roger
As far as I know the model agreement that Switzerland and I think Japan are trying to set up with the US lets bank clients to not allow the banks forward thier information and the banks don’t have to close the accounts of these clients. The US however will be able to ask for the information of these clients through the Swiss gov’t. I guess it depends on what the UBS and the client agrree upon at the time.
@swisspinoy, Sounds great! I hope you are off on Thurday! My head usually hurts on the moring of August 2nd 😳
@Petros, Could you please forward my email address (the one I used for access to this blog, not the one for the forum) to swisspinoy so that we can contact each other? thanx in advance!
Swiss Department of Finance says that this is ok? Have they forgotten their own laws and constitutional framework?
I am really surprised that they can be so two faced, especially with the Swiss federal press release of June, sorry, I feel obliged to read it into the record here again:
http://www.news.admin.ch/message/index.html?lang=en&msg-id=45046
Switzerland and United States announce declaration on FATCA implementation.
Bern, 21.06.2012 – Today, Switzerland and the United States announced a joint declaration on the implementation of the US tax legislation known as FATCA. The details are to be negotiated in the months ahead. The Federal Council will adopt a mandate for negotiating an intergovernmental agreement beforehand. This should increase legal certainty for affected financial institutions and reduce implementation costs.
With the enactment of the Foreign Account Tax Compliance Act (FATCA) on 18 March 2010, the United States wishes to ensure that all accounts held abroad by US taxpayers are actually taxed. FATCA basically requires foreign financial institutions (FFIs) to enter into a FATCA agreement with the Internal Revenue Service that imposes reporting requirements on them regarding US accounts. A financial institution has to obtain the client’s consent in order to submit such reports. A client who does not consent is considered recalcitrant. In the case of such clients, financial institutions have to withhold 30% on all payments coming from the United States.
The implementation of these provisions is generating high costs and legal uncertainty worldwide. Switzerland’s refusal to implement FATCA would cause major disadvantages for the financial centre. The prohibitive withholding tax of 30% on all payments from the United States and the likely consequence that foreign financial institutions would terminate their business relationships with Swiss financial institutions in the medium term would result in exclusion from the world’s largest capital market.
The key points of the declaration signed today are based on a model developed by Switzerland and Japan in collaboration with the United States that accommodates the needs of both countries. Unlike the implementation model of five large EU countries (Germany, France, Italy, Spain, United Kingdom), the exchange of information is to take place directly between the financial institutions and the Internal Revenue Service rather than via centralised government data gathering.
Simplifications could be provided for within the scope of an intergovernmental agreement. The following facilitation measures are sought under the joint declaration:
Negotiations between Switzerland and the United States on the resolution of outstanding tax issues concerning the past are still ongoing. It is hoped that an agreement will be reached by year-end.
Address for enquiries: Mario Tuor, Head of Communications, State Secretariat for International Financial Matters (SIF),
+41 31 322 46 16, mario.tuor@sif.admin.ch
Publisher:
Please, everyone write this contact person Mario Tuor. mario.tuor@sif.admin.ch It doesn’t matter if you are Canadian or any other nationality. These people need to know that people with strong democratic values and belief in universal human rights are watching and that Switzerland’s democratic values and so-called belief in human rights are now in question.
*@swisspenoy, your statements seem to confirm what I had heard elsewhere that USB had established a branch specifically to handle all of the accounts for its US persons, and thus segregate them from its normal banking business.. This branch would be totally compliant with FATCA. It was also my understanding that there were higher mnimum balance and monthly fees for US person accounts with this branch. Can you confirm if that is true? This was supposedly to compensate USB for its higher costs of FATCA compliance for this branch.
My wife was denied banking services from Credit Suisse in June. So, I do not think they are taking new clients.
*zuludogm, I inquired with Credit Suisse concerning Swiss citizens who are accused of being “US Persons”. The situation is likely different for migrant workers, tourists, diplomats or non-residents.
I updated the list and will continue to inquire whenever I have time. On the web site of Swissquote Bank, one gets the impression that they allow US Persons, but this has changed and is no longer the case. They are currently offering a mortgage interest rate for 5 years at 0.960%. Of course, this is available to everyone who is not taxed by the US government.
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@UncleTell:
UBS is updating its customer master data when customers have an appointment with a Kundenberater, as I understand it. The form looks like this (previously posted):
http://isaacbrocksociety.files.wordpress.com/2012/08/ubs-ch-acct-opening-form-p1.pdf
@Swisspinoy:
In early July a real estate agent checked with the following banks to determine whether they would make a mortgage loan to a USP. The agent stated these are the banks the firm usually works with. The answer was “no”:
Raiffeisen, Valiant, Neue Aargauer Bank, Hypo Lenzburg
The agent did not inquire UBS or CS because the agent does not have contacts there.