Vontobel quält alte Berater mit Mathe-Test

With some Banks Swiss Private Banking is in steep decline, these exams will do nothing to improve the service (if you can call it that) customers (just don't call them clients anymore) can expect.
Vontobel quält alte Berater mit Mathe-Test - Inside Paradeplatz

Tax Striptease - Your Freedom is eroded once more

Notwithstanding the fact that Swiss Bank Secrecy saved many a life among those persecuted during the Third Reich the Kleptocrats ruling in our Pseudo Democracies are hell-bent on achieving total control of the lives of their citizens. One day a government will blackmail citizens to hand over all assets held outside its jurisdiction - the 'Land of the Free' is already close to a totalitarian tax dictatorship and others will follow as long as the march to ever-increasing government spending and waste continues unabated.
Ausländer müssen UBS intime Steuerdaten geben

Sad end to Swiss Bank Secrecy

Switzerland has been created as the result of a tax revolt against its Hapsburg (Austrian) overseers. So it is sad that a proud nation abases itself to become what can only be seen as a tax collector for the USA. Different nation states with different laws and customs were the main factor behind the fantastic cultural and economic development of Europe - in stark contrast to the unitary state of China.Nevermin d that bank secrecy helped any number of persecuted people to escape from Nazi Dictatorship with their lives and the means to start a new life elsewhere!

Credit Suisse said to freeze accounts in search for U.S. assets

Swiss Banks client Gold to allocated accounts

The banks are reported (Financial Times) to suggest to clients to move their physical gold holdings to allocated accounts. These gold holdings then are no longer part of the bank's balance sheet and do not require costly equity capital to back it up. To a certain extent this increases the safety of the client's gold holdings as any bankruptcy of the bank would no longer have any detrimental impact on the client's claim to ownership of the gold (assuming the physical gold is segregated properly - which is not always the case as several recent cases in the UK demonstrated where client holdings of various assets were not properly segregated). Investors should be aware, however, that banks (and other custodian institutions) might at any moment be prevented from giving access to gold that is in their custody if the governments/regulators order them to do so.

Who protects the investors?

When reading that the justice authorities in the Swiss canton of Ticino have completed their investigation into the bankruptcy of Sogevalor, a financial advisory firm that went out of business in 2004 (!) one has to ask who - if anyone - is really protecting investors from fraud and malpractice. Those responsible for Sogevalor's demise - and the alleged fraud that cost investors up to Sfr 130 million - have not even been charged and may well escape any formal prosecution. Even under most optimistic assumptions a court case could be a protracted procedure - especially when a lengthy appeal process is adopted. By that time quite a few of the investors - and maybe even those eventually found responsible - may no longer be in this world. The lesson from this and similar cases should be: BUYER BEWARE! Investors should only part with their money after careful investigation. A clear separation of the safekeepking (custodial) function and the investment advisory role would be the optimal solution we recommend.

Unbelievable neglect of customer confidentiality!

It is reported that in the course of its agreement with US authorities UBS in Switzerland accepted the obligation to report the destination banks for all US customers. It may have been done via the Swiss authorities but the bank should have been aware of the consequences for its 'clients'.

Private Banker diverts Sfr 1.5 million and escapes jail!

The selection of an trustworthy financial adviser is of the utmost importance. While no customers of the bank in question have lost any money the case case should still set alarm bells ringing. When the director of a bank can escape a prison sentence even after he admitted that he 'diverted' Sfr 1.5 million from commission payments to his own accounts the sentence demonstrates that crimes by banking and finance professionals are still not punished in the same way as crimes by 'ordinary' criminals and investors should be extra careful when selecting a financial adviser. That the banker in question enjoyed a basic annual salary of  Sfr 240'000 and at one stage received an annual bonus of Sfr 816'000 is proof for the extent of his greed.

Who is protecting your confidential information?

In times where huge amounts of information can be downloaded by any bank employee with some basic computer skills it is amazing - not to say frightening - that a Swiss bank can treat client data with so little care and respect as happened at Credit Suisse. Not less than 4812 pages of client information were sent to the Swiss Federal tax authorities when only information about 5 named US citizens was requested. Is it really that hard for highly paid Brady Dougan, the chief executive of the bank, to make sure that clients (the original Latin word means 'someone you are protecting') get more care? The fine old tradition of numbered accounts should be considered as a safeguard - this time not to facilitate tax evasion but to prevent unauthorised use of information.

Dangerous Swiss Cheese

Swiss authorities and banks have thoroughly capitulated in their battle to preserve the interests of their banking clients. In an age where the appetite of politicians and pressure groups to lay their hands to the citizen's savings seems to know no boundaries it was maybe too much to ask for a more resolute defense of citizen's rights for privacy. All the countries that want a piece of the action - and Pakistan of all countries is the latest arrival - and claim their share of the funds their citizens have entrusted to the once safe haven of Switzerland - had it in their remit to construct a wall around their countries and prevent citizens from sending their money abroad. That way it would have become obvious what their understanding of civil liberties really was. The much larger danger lurking ahead is an even larger crisis engulfing the Eurozone and its banks and the risk that this would lead to capital controls and even confiscation of all savings and investments in a desperate attempt to shore up tottering welfare states. We can only advice all readers to diversify their asset in terms of geographical location and asset classes. Transactions that leave an audit trail should be kept to an absolute minimum.

Is Switzerland a safe place for your Money?

Recent reports about Swiss financial institutions refusing cash disbursements when clients demand them cast a very long shadow on Switzerland as a safe location for investors that traditionally have seen it as a bulwark against authorities in their native countries. We leave it to our readers to work their way through the various agreements between Switzerland and other countries (see for example the agreement with Germany) but the fact is that these are rubber paragraphs where the interests of the investors are right at the bottom of priorities and the interest of an overbearing state is right at the top. We would add that a perusal of the 'interpretation' by the Swiss Banker's Association or a 'position paper' issued by the Financial Regulator does not inspire more confidence either.

Are you protected against fraudulent investment advisers?

A report about the loss of Sfr 20 million that has been uncovered in the private banking department at UBS highlights the need to carefully select and monitor investment advisers. In this particular case a senior adviser to very high net Spanish clients had caused the misappropriation and the bank had to reimburse them. So one could say that it pays to entrust only very large and financially strong institutions with the management of one's investments. But there is another way and it means that independent or smaller money managers can well be entrusted with the direction of the investment but that the safekeeping of the securities and funds should be handled at arms-length by an independent and secure custodian.

Leave Derivative Esoterics to the Specialists

An article in a Swiss financial newspaper that is also widely read by more or less sophisticated private investors recently carried an article explaining how to use the 'Barrier Hit Probability' when evaluating a certain type of structured derivative product (often known as Warrant or 'Certificate'). We advise all but the most enterprising investors not only to not burden themselves with the details of such products but to stay away from any investment in them (or advisers that try to put their money into such products). Not even the experts agree on how to value these products and the underlying assumptions are so difficult to predict that the results are only giving a false sense of security.

Swatch may sue UBS for mis-selling 'absolute return product'

There is a natural conflict between every Financial Service Provider and Investor/Client. No amount of regulation will be able to overcome this problem. If someone sells you some apples on the market the same problem exists. So the watchword has to be: Buyer Beware! Fee-based advisors like Private Banking Advisory can help to mediate between the opposing parties to any transaction. High moral values can alleviate the problem but no one should rely on that alone. Maybe Swatch should have stuck to its knitting and focused on making good watches?