Hitler:
http://switzerland.isyours.com/e/banking/secrecy/nazi.spies.html
Swiss bank secrecy tightened due to Nazi spies
In 1934, the Swiss Federal Parliament explicitly introduced the notion of bank secrecy for the first time in a section of the law and created criminal sanctions. Why was this law created? The first and most common explanation is the one taken up by the Swiss Bankers Association, which considers the event to be a political act by the Federal Parliament to demonstrate its independence and its neutrality in the face of the threatening power of Nazi Germany.
In the wake of the 1931 financial crisis, the Weimar Republic introduced strict foreign exchange controls. Many cases of economic espionage led by the German tax and customs authorities were exposed in Switzerland, while the Swiss laws were not sufficient to fight effectively against such practices. In reality, while the German agents risked deportation, at the very most, the German clients who fell victim to violation of bank secrecy were harassed by the Nazi government and forced to empty their Swiss accounts to the profit of the Third Reich.
In early 1933, the Swiss government felt it necessary to incorporate criminal provisions in the legislative enactment it was working on. In that way, the justice system would have more dissuasive weapons to guard against foreign infiltration. The will grew even stronger when Hitler came to power in 1933, with his threatening attitude regarding his political opponents and the Jewish population. In June 1933, the German Nazi government created a series of laws that obliged German citizens to declare all foreign holdings. The penalty prescribed for failing to do so was death: Any German national who, intentionally or unintentionally, led by lowly selfishness or some other type of vile sentiment, has accumulated wealth or kept funds abroad will be punished by death. In July 1933, a law was passed on the confiscation of goods belonging to public or State enemies, so allowing the Nazis to seize all of the German Jews’ assets.
The Gestapo was in charge of despoiling operations abroad. One of the procedures they used to determine whether a German had an account in a Swiss bank was the following: an SS agent in civilian dress would walk into a Swiss bank and give the teller a sum of money to deposit into the account of Mr. X, who the Gestapo believed had an account in Switzerland. If the banker agreed to make the deposit, there was proof that an account existed. In some cases, the mere look of discomfort on the teller’s face was grounds enough for the secret agent. Then all the Gestapo in Germany had to do was exert major pressure on the presumed bank client to give instructions for the Swiss bank to repatriate the funds. (Note that with numbered accounts, neither tellers nor bank employees know the identity of the account holders, who are thus protected against this type of indiscretion.)
When three Germans were put to death in 1934 for having an account in Switzerland, the Swiss authorities were convinced of the necessity for a strict law on bank secrecy to protect Swiss bank clients by the criminal code. With the threat of imprisonment for any banker who violated bank secrecy, the Swiss government imposed a blocking mechanism against its fascist neighbors’ laws of extraterritorial pretense. This protected the clients and the Swiss bankers, since no authority could henceforth constrain them by law to commit a crime.
The tenacious Nazis nevertheless continued to conduct banking espionage on Swiss territory. The most resounding case was in March 1935, with the kidnapping of Berthold Jacob, a German Jewish refugee. Mr. Jacob was kidnapped in Basle by a German agent and taken to Germany. Swiss public opinion was outraged by such violation of Swiss sovereignty. The government finally managed to get Berthold Jacob released, but this event made the Swiss people and authorities acutely aware of the necessity for a law on espionage. A section was added to the criminal code in 1937 and served as an effective complement to the provisions on bank secrecy.
Merkel:
MASSIVE TAX EVASION SCANDAL IN GERMANY
The Liechtenstein Connection
With one bigwig already toppled for tax evasion and hundreds more likely waiting their turn, all roads lead to the tiny principality of Liechtenstein. According to SPIEGEL sources, Germany’s largest post-war economic scandal started with a single intelligence source.
It is rapidly becoming one of the largest economic scandals ever in Germany’s post-World War II history. As many as 900 wealthy Germans – many of them well-known – might be involved. Berlin may have been shorted up to 4 billion euros in taxes. And the accusatory finger is pointing increasingly at what many feel is rampant greed among of many of Germany’s top earners – and at a handful of banks and foundations in the tiny principality of Liechtenstein that help the affluent hide their assets.
DPA
German investigators have their hands on LGT Bank data that may implicate hundreds of wealthy Germans of being involved in tax evasion.
The first to fall was Deutsche Post CEO Klaus Zumwinkel. He resigned on Friday after raids on his home and office by officials looking for evidence of massive tax invasion. But with officials planning to launch up to 125 additional tax evasion investigations next week, it is likely that Zumwinkel will soon have to share headline space.
The growing investigation has its roots in information handed to tax investigators by Germany’s foreign intelligence agency, the Bundesnachrichtendienst (BND). Last week, the BND insisted it had been little more than a messenger, but according to SPIEGEL sources, its involvement is more reminiscent of a Tom Clancy novel than of a run-of-the-mill operation.
In 2006, a man approached the BND offering agents a DVD full of information detailing foreign investments and following capital flows from Germany into those investments. In addition, the source claimed to have particulars pertaining to a number of accounts held by the LGT Group, a bank managed by the principality of Liechtenstein. But he was charging a hefty price for the DVD.
BND agents moved slowly. Their source, whose identity has not been made public, offered up samples from his data for German officials to test. And they were satisfied with the information’s trustworthiness. In the end, the source was wired 5 million euros for the data disk, and he also requested personal protection out of fear for his life. The payment was made with the knowledge of German Finance Minister Peer Steinbrück.
While hundreds of its customers may be compromised by the information now in the hands of eager German investigators, the bank is doing its best to assure its clients that the DVD contained details stolen from LGT Trust Ltd, a part of the LTD Group located in Vaduz, Liechtenstein six years ago. That case was closed in 2003 after the perpetrator was convicted. The data, the bank says, was “illegally passed on.” The bank claims that “there is no indication that customer information has been stolen since 2002.”
But according to SPIEGEL sources, German investigators are in possession of bank data on Liechtenstein-based tax evasion that goes all the way through the end of 2005. They also have account information from the Liechtensteinische Landesbank (LLB) which may reveal tax evasion. The LLB announced at the beginning of the week that it too had been the victim of a major data theft. According to SPIEGEL sources, that data too is still in circulation.
Regardless of how the data landed on the desks of German tax investigators, the growing scandal has caused outrage across the country and in the capital. German Chancellor Angela Merkel on Friday once again reminded German economic leaders that they carry a huge responsibility. “Responsible behavior from companies is an elementary prerequisite for a functioning socially-responsible market economy,” she said. Minister of the Economy Michael Glos, a conservative like Merkel, told the Sunday tabloid Bild am Sonntag that German managers have to “become aware that they are role models for society.” Otherwise, he said, “faith in our market economy will be lost.”
Others were a bit more pointed. Interior Minister Wolfgang Schäuble, from Merkel’s Christian Democrats, told SPIEGEL “I have zero understanding for this kind of greed. Uncontrolled capitalism, greed and massive losses on speculative investments – that is a combination that makes people furious.” Steinbrück, the Social Democratic Finance Minister, told the online version of the weekly Die Zeit: “It is the elites who are threatening to cause the system to collapse.”
On Monday, the SPD plans to pass a resolution looking at whether prison sentences for tax evasion should be lengthened. The party accuses elites in Germany of ignoring the responsibility they have for the common good. “The money that perpetrators keep from the community short-changes education, security and infrastructure,” the draft document reads.
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