ZKB knew that some U.S. taxpayer clients held undeclared accounts with ZKB in order to circumvent their U.S. tax obligations, in violation of U.S. law. The ZKB understood the legal prohibitions on tax evasion as well as the ZKB`s obligations under its qualified intermediary agreement.â Some ZKB bankers used the term “black money” in German for “black money” internally for undeclared accounts, including those held by US citizens. Until mid-2008, ZKB did not prevent U.S. individuals from opening an account if they refused to fill out a W-9 form, even though ZKB knew that these accounts were not registered or most likely not registered. In fact, in May 2006, the profitability of “undisclosed” U.S. persons was explicitly discussed in internal ZKB documents.
In 2008 and 2009, however, ZKB`s EAM office proactively attempted to reduce its U.S. operations. At first, the restrictions only applied to former UBS clients, but ZKB has expanded its restrictions over time. In June 2009, ZKB decided to close its operations with all U.S.-domiciled clients with securities accounts, and in 2011, ZKB decided to cease operations with all remaining U.S.-domiciled clients. By 2012, ZKB had closed virtually all accounts held by U.S. resident taxpayers, and for U.S. customers residing outside the U.S., ZKB requested a Form W-9 and proof of U.S. tax compliance. ZKB has now ceased all cross-border operations in the United States. Mr. Berman also announced a deferred prosecution agreement with ZKB (the “Agreement”) in which ZKB admitted its illegal conduct in assisting the United States.
Taxpayer customers in violation of their legal obligations. The confession is contained in a detailed statement of facts annexed to the agreement. The deal requires ZKB to pay a total of $98.5 million. The $98.5 million partly reflects a loan to ZKB as a result of its cooperation in the case. However, the amount of ZKB`s cooperation loan was reduced by the Government on the basis of the measures taken by ZKB, as described in the statement of facts, to prevent two bankers accused of ZKB from cooperating with the United States. Authorities for years after their indictment. Accused bankers STEPHAN FELLMANN and CHRISTOF REIST also pleaded guilty today. “Customer” means, in the case of a person accepting this Agreement on his or her own behalf, such person or in the case of a person accepting this Agreement on behalf of a company or other legal entity, the company or other legal entity for which such person accepts this Agreement and the affiliates of such company or entity (so long as they remain affiliates), entered the purchase orders. In a filing Friday in U.S. District Court in Manhattan, a federal prosecutor said that “the government will not prosecute ZKB now” because the lender “is fully compliant with the August 2018 agreement.” 2.5 Free Trial. If Customer registers for a free trial version, ZKB will make the relevant Services available to the Customer free of charge until (a) the end of the free trial period for which the Customer has registered to use the relevant Service(s) or (b) the start date of the purchased Service Subscriptions ordered by the Customer for such Services, whichever occurs first, or (c) termination by ZKB in its sole discretion. Additional trial conditions may be posted on the trial registration webpage.
These additional terms are incorporated by reference into this Agreement and are legally binding. 5.6 Taxes. ZKB`s fees do not include any taxes, duties, levies or similar government charges of any kind, including, for example, value added tax, sales, use or withholding taxes that may be imposed by any jurisdiction (collectively, “Taxes”). Customer is responsible for paying all taxes associated with its purchases under this Agreement. If ZKB is legally obliged to pay or collect the taxes for which the Customer is liable under this section, ZKB will issue an invoice to the Customer and the Customer shall pay such amount, unless the Customer provides ZKB with a valid tax exemption certificate approved by the relevant tax authority. For the avoidance of doubt, ZKB is solely responsible for any taxes that may be charged to it on the basis of its income, assets and employees. In December 2012, three ZKB bankers – FELLMANN, REIST and Otto Hã1/4ppi – were charged in the Southern District of New York with conspiracy to defraud the United States and the IRS for their role in the ZKB crime. Although ZKB retained independent U.S. advisors for bankers from 2013 to 2015, ZKB`s in-house counsel and, at times, ZKB employees of HR and other departments met regularly with FELLMANN and REIST. At these meetings, where FELLMANN and REIST independent U.S. Among other things, the ZKB made statements that led FELLMANN and REIST to feel dissuaded from contacting the U.S.
Attorney`s Office to explore the possibility of cooperation. In addition, ZKB FELLMANN`s in-house counsel stated that he had no useful information to assist in the ongoing investigation by the United States Attorney`s Office. Furthermore, on the basis of discussions with ZKB, FELLMANN and REIST were of the opinion that their retention in ZKB and the continued payment of their legal fees by ZKB would be jeopardised if they took measures which ZKB considered incompatible with the bank`s own interests. As a result of these discussions with the ZKB, FELLMANN and REIST did not seek to cooperate with the investigation until the summer of 2015, about two and a half years after the indictment. 8.1 Representations. Each party represents that it has validly entered into this Agreement and that it has the legal authority to do so. Zürcher Kantonalbank is subject to the provisions of Swiss anti-money laundering law, which are in accordance with the FATF recommendations (Switzerland is a member of the FATF). This means, among other things, that Zürcher Kantonalbank must identify its customers and establish the identity of the beneficial owner. Anti-money laundering compliance guidelines approved by the Board of Directors include, among other things, customer identification and beneficial ownership identification processes. The policies also cover the collection of information about clients` business activities, relationships with politically exposed persons, and records retention procedures. In addition, Zürcher Kantonalbank regularly provides anti-money laundering training to the employees concerned and does not provide banking services to banks that do not have a physical presence in any country and are not a regulated subsidiary. The anti-money laundering guidelines also apply to head offices and branches and are in line with the Wolfsberg Anti-Money Laundering Principles.