Bank Left

Remember when no deposit, no return applied to soft drink bottles? Kind of like those warm and fuzzy Swiss bankers ready to help a drug lord store purloined cash, a less-than-benevolent dictator keep extorted capital drained from his third-world nation mired in survivalist poverty, a terrorist group investing its "contributions" wisely, a Greek magnate simply exporting profits before the government even knows the money's gone, that American securities trader parking all that untraceable cash from illicit insider trading ventures or even that American corporate predator keeping income sheltered from a divorcing spouse. Forget about Nazi gold melted from the teeth of executed Jews; that's old stuff.

As the U.S. Internal Revenue Service pushed Swiss authorities to release some of "those" lists of accounts held by U.S. residents that had been protected under Swiss banking secrecy laws, worried depositors and potential depositors began looking where else to deposit money they really didn't want anyone to know about, especially not creditors, governments or wives. The September 22^nd New York Times: "In 2007, the U.S. Justice Department began a criminal investigation of UBS and, later, other Swiss banks for selling private banking services to wealthy Americans that allowed them to evade U.S. taxes… Last year, UBS paid $780 million to settle the charges. It later agreed to lift the veil of Swiss bank secrecy and disclose the names of 4,450 American clients to the U.S. Internal Revenue Service. The settlement concerned clients courted on U.S. soil and pertained only to accounts held in Switzerland because it involved a U.S.-Swiss tax treaty."

Well, it seems that the financial mavens who developed their banking skills in Switzerland were able to export that expertise to Asian nations looking to grow the money retained within their borders, nations thinking that Switzerland's loss could be their gain… if only they could get those banking laws to work better than they did in Switzerland. After all, can't capitalism can turn a blind eye to where the money came from if the profits are high enough? "It's only money, folks and if we don't do it somebody else will" goes the logic. Places like Singapore and Hong Kong.

The New York Times explains: "[T]here is a twist in this shift to the East: Many of the banks growing in these low-tax oases have Swiss pedigrees. And their clients are not only Asia’s growing number of millionaires but also wealthy Americans and Europeans who, lawyers say, have been spooked by mounting scrutiny from the tax authorities in their own countries… From UBS, which operates a training center in Singapore from Lord Mountbatten’s former compound, to smaller private banks like Julius Baer, Swiss banks and those with Swiss-based operations are tripping over themselves to expand in the region… 'We have seen a massive uptick in hiring hundreds of private bankers' in Singapore and Hong Kong 'to take the business leaving Switzerland,' said Raymond Baker, the director of Global Financial Integrity, a research institute in Washington. "

Hong Kong and Singapore claim that their laws do not create a haven for criminals, but on a pragmatic side, penetrating those banking systems is well nigh impossible, even for the most dedicated international policing authorities. With over an estimated half trillion dollars migrating out of the Swiss banking system and other European "off-shore" banks (according to Wealth Bulletin), mostly into these Asian markets, it seems those with money to hide believe much more in Asian discretion than in Swiss bankers these days. The Times: "Singapore’s private banking assets grew sixfold, to $300 billion, between 2000 and 2008, according to Calamander Group, an investment boutique. Singapore now has about $500 billion in private banking assets, while Hong Kong has $200 billion, according to the Boston Consulting Group.… The cross-border market in Singapore and Hong Kong will swell to about $800 billion in assets by 2012, UBS estimated earlier this year. Two UBS spokeswomen did not respond to further questions over several days on whether the bank sells undeclared banking services to Europeans and other non-Americans through Asia. " How nice to know that our friendly neighborhood terrorists' funds are safe and sound and ready to be used when needed… against us.

I'm Peter Dekom, and some of those secrets can kill you.