Article: Swiss to Review Banking Secrecy Laws
published on 07.03.2009
by s928163
The Swiss banks are known for its tight secrecy policy. For nearly 300 years, the Swiss government has been resisting in loosening this policy. Even with the mounting pressure in the recent years, the Swiss government insists that such policy is important for their most important industry, the Financials. Abolishing the secrecy policy will cause customer loss, and endanger the county’s financial system. However, is it morally right to protect the depositors who have violated tax laws in their own country? Does Switzerland have the moral obligation to assist other countries in taxation fraud investigation? In the following article, it will be analyzed with respect of the four perspectives.
In consideration of the perspective of law, the tax evasion is not considered a crime under Swiss law. Only when the terrorism and other criminal matters are involved would the banks waive private information. In the meanwhile, with the efforts to protect their customers’ Right to their bank secrecy, the Swiss government might be able to stay in the boundary of the perspective of Right. However, when considering the human right of the other countries, it is clearly wrong to withhold crucial information of those who have violated law in their own country.
Now judging from the morality of “what we owe others”, when the Switzerland decided not to assist other countries in investigation of the taxation fraud, they have actively complicated the guilty actors. Citizens who benefit from their society have a moral obligation to contribute to that society, and to obey the laws. In ensuring their own benefit, the Swiss banks have deprived other’s entitlement of justice.
Link to the lecture:
The four perspectives and the morality of "what we owe others" in view of swiss action.
Subscribe to:
Post Comments (Atom)
11 comments:
by s347055
I think it is also possible to say that keeping information private; which allows people to not pay taxes, is not within the borders of Right. Right consists of rules that are need to ensure the constitution of a free society in which everyone has equal rights and duties. But if some are 'allowed' to not pay taxes, this is certainly not right in the morality of what we owe others. And since the bank does actively not prevent this, I think they do not stay within the limits of Right. But the rules/laws for (some)banks have already changed a bit since last weak, so that these situations may come to an end.
Since tax evasion is not depicted a crime by Swiss law, the Swiss government is acting in accordance with the prescriptions of the legal perspective. Given the fact that the market for financial institutions is Switzerland’s most important industry one can also conclude that banks uphold the prescriptions of the business perspective (i.e. aimed at profit maximization).
It is stated that ‘Swiss banks have deprived other’s entitlement to justice’. But is this really the case? When we assume the moral perspective and take into account the morality of what we owe others, we first need to make sure that the concept of morality is not compromised by external factors. This indeed seems to be the case since Swiss banks merely follow regulation set by a more powerful institution. Therefore, one cannot simply conclude that banks are not acting morally right since they, at least partially, are limited in their actions by the government.
René Megens
s113313
This is clearelly a case of moral motivation. The swiss government knows what is morally right but do not want to do it because it will hurt their large banking sector.
Most customers of these secret accounts are doing this to evade their countries law (taxes, criminal actions) by protecting them you in a sense,are collaborating with these actions.
It is your Right to be free in your actions as long as you do not damage others. By not paying taxes for example you violate the what you owe to others (who do pay taxes) principle.
This case though will be a difficult one, because banks themselfs have probably contractual rules that guarranty clients privacy, and it will be hard to break these rules withought encountering legal/economical problems.
In the long run though it is morally clear that swiss banks should not have secret accounts for foreign clients.
I divide my response into parts to whom it is directed:
To 928163: You are making a very strong argument I think. I still have some questions though.
To get it straight; you are wondering (rhetorically) if it is “morally right to protect the depositors who have violated tax laws in their own country?” and if “Switzerland ha[s] the moral obligation to assist other countries in taxation fraud investigation?”
Now, the article that you refer to is purely about taxes and you state that for terrorism and most other criminal matters the banks waive private information. Personally I even doubt if most criminal matters (money that has been put on an account from bribes, swindles, etc.) are being reported by the banks when requested by other governments or institutions, but let us not go into that at this point.
I assume that regardless how people acquired their wealth, they go to a Swiss bank account because they value their privacy. As you also stated in your article, the banks have a history of over 300 years of notorious discreetness towards their customers. Is it – according to you – morally right to ask the banks to give op this discretion? (and hence, break their promises of privacy?)
Furthermore, you are going quite far by stating that Switzerland complied(/complies) actively with tax fraudulents. To compare this to the case of Yahoo in China I believe we came to a whole different conclusion. It is quite the same example; A government states “We are looking for people that did something wrong to our Nation and the people in it, you should help us”. Even more strict; Yahoo conducted business in the country that was requesting the aid of the company, whereas the Swiss banks on the other hand are not even near the American border! In addition, Yahoo actively complied in the violation of Human Rights by honoring possible requests beforehand. Swiss banks – as we are discussing now – do not even comply when requested.
So in the case of the Swiss banks, they are actually not violating Right (i.e. the Right to privacy) and you are still condemning them for actively complying to ‘guilty actors’.
I do agree with you that Swiss banks have a moral duty to assist the Governments that request personal information of people that they suspect to be tax fraudulents. If not, they ‘violate’ the morality of what is owed to others. However, these Governments in their turn have to have good reasonable arguments, data and specific requests for specific suspects.
So to answer your questions from my point of view:
- is it morally right to protect the depositors who have violated tax laws in their own country?
I would say that this bumps on a moral question if one can ask the banks to give up their discretion, which is one of their ‘unique selling points’. (You can dispute this of course)
- Does Switzerland have the moral obligation to assist other countries in taxation fraud investigation?
Only, and only if, the other countries have good and reasonable arguments to suspect a person and request specific information about that specific person. If this does not happen, the Swiss banks and the Swiss Government would violate the Right to privacy if they would comply to the requests of the other governments
So it has been a long story up until now, but I have another thing to Nikkibosch:
(also partly based on the above)To not actively prevent something is a bad thing in this case?
I do think that you are right to say that if there are public examples of people who are ‘allowed’ not to pay taxes that that is a bad thing which enhances bad behavior. However, there is no minimum set of rules (Right) that states (positively) that you should help other countries in catching the bad guys; this is a duty. Hence, I would not say that the Swiss banks go against Right.
And to finish
to s701304:
Why is it clearly a problem of moral motivation? If that would be the case then there is no reason to even dispute their position and just condemn them for their immoral actions. As implicitly stated above; it is a Moral Hard Case. There is a good moral reason to assist the other Governments (helping them to catch ‘the bad guys’. And there is a good moral reason not to assist the other Governments (not violating the Right to privacy).
kind regards,
893092
As the tax evasion is not considered a crime under Swiss law, it's legally right to tight secrecy policy, and it's better to keep it because the business perspective is about profit maximizing. Moreover, Morality interpret the Right relates to (enforceable) actions, so banks should protect their customers' private information.This policy only against the morality of "what we owe others", it doesn't take into account the "unenforceable duty" that protect the depositors who evade taxation obstructing the investigation of taxation fraud for other countries.
But as morality of what we owe others is grounded in reasonableness, it gives priority to the acknowledgement of principles but not the actions, and the investigation of taxation fraud for other countries are depend on specific case and situation, we can not say the Swiss bank are acting morally wrong.
by:
Zhe Gong
S479253
I also think the Swiss bank are not acting against legality.Since it is legally allowed to keep banking issues secret they are, in this field, not acting morally wrong.
However, i think they are acting morally wrong in accordance with 'what we owe others'. I think they have a moral duty to assist other countries in taxation fraud investigation.
SO in terms of the human rights of other counttries they owe it to other citizins and the government of other countries to provide this crucial information. These citizins and governments have the right to obtain this information.
s746014
As far as I concern and base on the morality of "what we owe others", the country should loosen its banking laws to allow the release of information on tax evaders to foreign governments. Because each country have right to know the laws of other country in order to develop their law, and in the well order society, every country should help other country to develop.
As what we learn in the business ethic: society should try to institutionalize “freedom for all”, Right should specify and materialized in the basic structure of the legal system
In another word, in order to avoid terrorism and other criminal matters, according to the right basis, the Switzerland's government has negative right to refuse to lossen its banking laws to allow the release of information on tax evaders to foreign governments.
s561332
jin liang
The core of the issue is whether the Swiss maintainance of its bank secret is against the morality of what we owe others (in this particular case: the citizens of the origin nations of the customers). Its obvious that citizens who don't try to avoid taxes feel cheated by the ones who do. Also, the tax avoiders perform morally wrong conduct by breaking the law, which is morally wrong in its own right. However, there are arguments on the other hand, that nations have much to gain by allowing this tax-avoidance. Often, this money is only marginal compared to the total tax revenue, but often this money is fully invested into projects which makes nations flounder. People want to invest their money into profitable projects and by not taxing it these people manage to use it to the greater benefit, better than the government could. It would be in the interest of all citizens to allow this tax avoidance. The money is better efficiently invested by private investors than the government could do by the tax revenues.
In this case, I think the Swiss government should loosen the policy for its tight secrecy especially for those people who holding a huge amount of property with unidentified sources. Of course, Swiss bank was famous for owning a best financial system for protecting their customer’s privacy and it’s morally right. But on the contrary, this policy is always protecting a large number of people whose income did not earn legally (e.g. violated tax law, bribe, corruption etc) and it will make more and more people especially those owning a lot of property with unidentified source took Swiss bank as a safe location. Hence, Swiss government did have a moral duty to assist other countries in taxation fraud investigation and even cooperate with other countries to investigate those people who has an unidentified income.
s538632
I think it is more of an issue of cultural relativism, what may be illegal in one culture, might be acceptable in another. Moreover, according to the article, Swiss Banks do give the information regarding tax fraud to foreign governments, because it is listed in a country’s criminal code, so Swiss banks cover tax evaders and criminals partially. It is a moral hard case for Swiss banks: to go against laws and regulation of its company, to keep promises to customers, acting legal according to laws of its country, or, on the other hand, to act illegal and support immoral acts on international, global level.
Since the Swiss government are the source of the authority which allows the tax evasion, therefore, based on right perspective, Swiss banks cannot be judged as a moral wrong doing.
There might be some conduct agreement between these banks and the customer that allows the tax evasion. By decided to vanished it, it will broke the trust between them and it may reduce number of customers. Thus it may cause some national problem to Swiss because these banks is significantly contribute the national income.
Regarding some customers of the Swiss bank may have financial problem and being sued by their own country, it belongs that national problems, not Swiss. Therefore it needs another point of view of determine the moral wrong doing.
Despite allowing tax evasion, Swiss government may conduct some transparent transaction among the Swiss banks and their customers so it can help Swiss banks control their money and prevent it from the wrong customers.
S 322591
Post a Comment