Study Material | Test Series
Drishti IAS
call1800-121-6260 / 011-47532596
Drishti The Vision Foundation
(A unit of VDK Eduventures Pvt. Ltd.)
mains Test Series 2018
Switzerland to Share Lists of Indian Account Holders
Jun 26, 2014

Finally loosening the strict confidentiality clause of its banking system and cooperating with India in its fight against black money, Switzerland has prepared a list of Indians holding accounts in various Swiss banks in the name of trusts or other entities and is sharing the same with India. The development has come as a shot in the arm for the government which set into motion a Special Investigation Team (SIT) to probe black money stashed abroad as its first decision after it came to power. The list would help in prosecution of offenders and bringing the estimated billions of dollars stashed abroad.

SIT vice-chairman Justice Arijit Pasayat said, "Swiss authorities are preparing the list and will hand it over to the government which will then forward it to us for scrutiny. We have discussed the matter with other members of the SIT. Our job will be made easier if it comes out to be what it looks like and we will take suitable action. This is a breakthrough development in the fight against black money. Till now, the impression was that Switzerland is creating hurdles in this battle."

Until now, all information that India has got about money stashed abroad by Indians has been through leaked lists of account holders shared by countries other than Switzerland. Now, Swiss authorities are identifying the real owners of funds held in various banks in Switzerland.  These individuals and entities are suspected to have held un-taxed money in Swiss banks through structures like trusts, domiciliary companies and other legal entities based out of countries other than India.

The Swiss official said, the details are being shared with India on a spontaneous basis and are different from the information sought earlier by Indian authorities on the basis of leaked or stolen lists of certain banks, including the so-called HSBC list.

The development comes close on the heels of Switzerland disclosing fresh data on money stashed by Indians in its banks. The latest data released by Switzerland's central banking authority Swiss National Bank (SNB) shows that Indian money in Swiss banks rose 43% during 2013 to close to 2.03 billion Swiss francs (Rs 14,000 crore), pushing its global ranking up from 70 at the end of 2012 to 58.

Swiss authorities, however, have said this money is not necessarily ill-gotten wealth as it is in the accounts of those who have declared themselves as Indian. The latest list being shared with India, however, is of those account holders who hold the account through trusts or other entities in foreign countries and are thus under suspicion.

The official refused to divulge the identity of these persons and entities, as also the quantum of funds held by them in Swiss banks, citing confidentiality clause of the bilateral information exchange treaty between India and Switzerland. He, however, dismissed claims that black money stashed in Swiss banks by Indians could be trillions of dollars, as the latest Swiss National Bank data pegs the total foreign client money across 283 banks in Switzerland at $1.6 trillion.

There are different estimates on quantum of black money stashed by Indians abroad. They range between $500 billion and $1,400 billion. A study by Global Financial Integrity has estimated the illicit money outflow to be $462 billion.


Helpline Number : 87501 87501
To Subscribe Newsletter and Get Updates.

http://www.drishtiias.com/upsc-current-affairs-article-Switzerland-to-Share-Lists-of-Indian-Account-Holders