A customer requests around eight kilograms of gold from the major Swiss bank, but the bank refuses to hand it over. The bank insists on a tax statement.
When it comes to taxes, Swiss banks still have to live with the accusation that they are not taking it very seriously. A customer from Germany, who had around eight kilograms of gold stored at UBS, now had to learn that times have long since changed: the bank does not want to move the precious metal out according to a report from Handelsblatt.
And that is because the man had refused to prove the correct taxation in the Federal Republic of Germany.
The project aims to build a trading platform and is supported, among others by billionaire VC fund Tim Draper.
The curious case not only shows that times have changed in Switzerland, but it also raises a fundamental question for Swiss banks: What law should they adhere to?
In a recently published judgment, the federal court in Lausanne dealt with the case. The judges partially approved the man’s complaint – but he still does not get his gold back.
Between 2003 and 2007, the man had transferred savings from Germany to a precious metal account with UBS. Around 299 ounces of gold were collected in this account, which, according to today’s gold price, would correspond to a value of more than 400,000 euros.
In 2014, the man wanted the bank to hand over the gold. However, UBS asked for written confirmation that the funds were taxed correctly in Germany.
However, the man did not want to sign the corresponding form. The bank, therefore, terminated the business relationship in 2014. The man insisted on the release of the gold and went to court.
The “paper trail” should be preserved
The Aargau High Court initially decided last year in the interests of the bank. UBS had argued that it had to comply with money laundering rules and keep the so-called “paper trail”.
For larger amounts, it must be clear where the corresponding values come from and where they are transferred to. A “dubious business relationship” should also be assumed because the man does not want to sign the tax form. The man appealed against the verdict.
The responsible federal judges in Lausanne have now overturned the decision of the Aargau High Court. A “dubious business relationship” should not be assumed in this case, the ruling, which the Swiss news agency AWP news agency initially reported. The Swiss money laundering law is therefore not violated by the delivery of the gold.
Nevertheless, the customer does not get his gold back yet. Rather, the judges in Aargau must now clarify how the handing over of gold should be assessed according to German law.
If this is tax evasion aid, the release of the gold would be a violation of the regulatory standards in Switzerland.
The complicated case shows that Switzerland has long lost its status as a black money paradise for German customers. UBS did not want to comment on any ongoing proceedings.
Bitcoin the Digital Gold Fixes this
We wrote recently an article comparing Bitcoin with gold the strongest point bitcoin has over gold is the censorship-resistant design bitcoin has.
Recently even central banks are admitting that if the economic system collapses, Gold Can Serve To Restore It. But Gold can be confiscated by authorities especially in times of crisis and we have seen this happening frequently during history. On the other side bitcoin, even being only a decade old currency compared to the thousands of years old gold, Bitcoin is an Unconfiscatable asset and this is where bitcoin beats gold.