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Published On: Mon, Oct 7th, 2019

India Gets First Tranche of Swiss Account Details

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1560777167_news_imageNEW DELHI /BERNE: India has received the first tranche of details about financial accounts of its citizens in Swiss banks under a new automatic exchange of information framework between the two countries.
India is among 75 countries with which Switzerland’s Federal Tax Administration (FTA) has exchanged information on financial accounts within the framework of global standards on Automatic Exchange of Information (AEOI), an FTA spokesperson told PTI.The next exchange would take place in September 2020, the spokesperson added.
The AEOI only relates to accounts that are officially in the name of Indians and they might include those used for business and other genuine purposes. Overall, the FTA has sent information on around 3.1 million financial accounts to the partner states and received information on around 2.4 million from them.
The sharing of the data that was prepared by all Switzerland-based banks under a direction from the Swiss government marks a significant milestone in the fight against black money suspected to be stashed abroad.
India figures among 75 countries with which Switzerland’s Federal Tax Administration (FTA) has exchanged information on financial accounts within the framework of global standards on AEOI, an FTA spokesperson told news agency PTI.
This is the first time that India has received details from Switzerland under the AEOI framework, which provides for exchange of information on financial accounts that currently active as well as those accounts that were closed during 2018.
Although a large portion of the first tranche of data relates to accounts that have been already closed due to fear of action, it can be quite useful for establishing a strong prosecution case against those who had any unaccounted wealth in those accounts, bankers and regulators have said.
Separately, the Swiss government said in a statement that the number of countries with which the AEOI has taken place this year is 75, out of which there was reciprocity with 63 countries.

In the case of 12 countries, Switzerland received information but did not provide any, either because those countries do not yet meet the international requirements on confidentiality and data security (Belize, Bulgaria, Costa Rica, Curacao, Montserrat, Romania, Saint Vincent and the Grenadines, Cyprus) or because they chose not to receive data (Bermuda, British Virgin Islands, Cayman Islands, Turks and Caicos Islands).The data was collected by the FTA from around 7,500 institutions including banks, trusts and insurers.

The data provides entire details of the entire flow of funds to and from all the accounts that were active even for a single day in the year 2018, bankers said. So deposits and transfers as well as of all earnings including through investments in securities and other asset classes can be examined.
However, the information exchange is governed by strict confidentiality clauses, and the FTA officials refused to disclose specific details on the number of accounts or about the quantum of financial assets associated with the Indian clients of Swiss banks. Also,
PTI had earlier quoted regulatory officials as saying that the first trance relates mostly to businessmen, including non-resident Indians now settled in several South-East Asian countries as well as in the US, the UK and even some African and South American countries.
They admitted there was a huge outflow from these accounts in the last few years after a global crackdown began against the so-called high-secrecy walls associated with the Swiss banks and several of these accounts got closed.
Besides, there are at least 100 cases of older accounts held by Indians, which might have been closed before 2018, for which Switzerland is in the process of sharing details with India under an earlier framework of mutual administrative assistance as Indian authorities had provided prima facie evidence of tax-related wrongdoings by those account holders.
Regulatory and government officials said the special focus of the analysis of the Swiss bank data could be on identifying people with political links. A Swiss delegation was in India in August before the first set of details could get shared under the new automatic information exchange. The AEOI is being seen as a major boost in India’s fight against suspected black money stashed abroad.(With Agency Inputs ).




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