The hard key fact is that U.S. Deputy Attorney General James Cole wrote a letter in which he demands that the Swiss turn over a lot of information related to U.S account owners. The precise details of the letter are unclear, but there are speculations. For a sample of the combination of facts and speculations, here is a sample the Reuters' article linked below:
The SonntagsZeitung quoted Swiss sources close to the talks as saying Washington is seeking details of all U.S. clients with accounts worth at least $50,000 between 2002 and 2010 at banks including Credit Suisse, private banks Julius Baer and Wegelin as well as the Zurich and Basel cantonal banks.Emma Thomason, U.S. sets ultimatum in Swiss bank tax dispute: reports (Reuters 9/4/11) here.
That could imply tens of thousands of accounts, the paper said, far more than Switzerland could deliver under a double taxation agreement with the United States that it approved in 2009 but is still awaiting ratification by the U.S. Senate.
Switzerland is keen to find a solution that would not need approval from parliament, seen as likely to block any new breach of bank secrecy after only reluctantly agreeing to the UBS treaty under emergency law last year.
If Switzerland does not comply, the United States could issue a subpoena against the banks to force them to hand over data, as it did in the case of UBS, the SonntagsZeitung and NZZ am Sonntag reported.
"This will be much more expensive as with UBS that had to pay a fine of $780 million," one banking source told the SonntagsZeitung. "We expect that the Swiss banks will have to pay a fine of up to 2 billion Swiss francs ($2.6 billion) and deliver much more client data than in the UBS case."