Excerpt taken from article.
Credit Suisse AG, Switzerland's second-largest bank, has begun notifying certain U.S. clients suspected of offshore tax evasion that it intends to turn over their names to the Internal Revenue Service, with the help of Swiss tax authorities.
Credit Suisse's notification by letter, a copy of which was obtained on Monday by Reuters, says the handover of names and account details will take place following a recent formal request for the information by the IRS.
Scott Michel, a tax lawyer with Caplin Drysdale in Washington, D.C., said that the letter could mean one of two things: either the United States was taking softer steps to bolster the thrust of its target letter to the bank, or Credit Suisse was in the process of reaching a settlement with U.S. authorities. Such a settlement, following the receipt of a target letter, would typically be a deferred-prosecution or non-prosecution agreement.
He said the fact that the Swiss tax authorities had ordered Credit Suisse to provide it the data to hand over to the IRS represented "a further erosion of longstanding Swiss bank secrecy."
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