The thrust of the article is that the Swiss want an all inclusive deal covering the 11 prominently mentioned Swiss banks and as many as 355 Swiss banks by paying up to $10 billion. Presumably the deal, if accepted by the U.S. would cover civil and criminal exposure for the banks and perhaps their employees and agents. But, according to the article, the U.S. prefers to negotiatewith the individual banks, at least the 11 ildentified egregious offending banks.
The article says in passing that the IRS referred the names of the 11 Swiss banks to the Justice Department. The term referral and its variants often is used to mean a criminal referral -- a referral with a recommendation for prosecution or for further grand jury investigation (perhaps the latter in this case). Also, the article says that the DOJ is conducting a civil investigation of "scores of other Swiss banks among the 355."
One big problem for DOJ Tax is that the Swiss want to protect the names of their U.S. customers. It would seem to me that DOJ Tax cannot agree to that. But the article suggests that the IRS might be willing to do that, reasoning (such as it is) as follows:
There are some signs that the IRS may in fact be unwilling to craft a deal without a requirement for a turnover of names. Case in point: in September, the agency began mailing an unusual, one-page questionnaire to American taxpayers who entered its voluntary disclosure programs in recent years.
The questionnaire, a copy of which was obtained by Reuters, asks taxpayers to answer "yes" or "no" to 10 questions regarding their undeclared offshore accounts. Questions include "did a representative of the foreign financial institution visit you in the United States regarding the offshore account or asset?"
The IRS questionnaire could be a warm-up to a broad request, known as a John Doe summons, to Swiss banks to disclose client data, sources briefed on the matter said.I have seen the letter she refers to as her "Case In Point" and can't see how that letter supports any inference that the IRS may be willing to craft such a deal producing no names of U.S. customers. Maybe readers can comment on that subject as well.
Probably, rather than seek blanket protection for those U.S. customers, as with UBS, the better part of wisdom would be to deliver up the egregious offenders -- those customers with account characteristics particularly indicating fraud (such as large amounts and dummy entities).
Finally, the article notes that the IRS think that there are far more U.S. persons who have not yet surfaced:
U.S. officials say Swiss banks and their American clients have yet to declare the bulk of the hidden wealth, and point to two recent IRS disclosure programs that brought in only $2.7 billion from 30,000 American taxpayers with accounts in 140 countries. "It's a fraction of the total still out there," said one U.S. government official briefed on the matter, adding that perhaps one quarter of the $2 trillion, or $500 billion, could be undeclared money held by American taxpayers.