For decades, the bank secrecy laws of Switzerland, Liechtenstein, Monaco, Andorra, the Channel Islands, and various sovereign states in the Caribbean (probably elsewhere, also) have encouraged mostly very wealthy people and, I suppose, crooks to keep their financial assets in the counting houses of these countries. Of course, this was to help these folk evade taxes, a peculiar fetish of the rich whose riches are protected by the state but who feel no obligation to fund its protections.
In the last few years, these tax havens have been under considerable pressure from the United States and other governments to come clean. This is something they do not want to do. Some of these principalities live off the "don't look" rules of their banks. Bank fees are almost the only commercial resource in these jurisdictions. So why should they kill the goose that lays the golden eggs?
Two articles by Haig Simonian in today's FT point out that the Group of 20 and OPEC have convened a conference "to single out countries with opaque rules" and decide what really can be done with (or, better yet, to) "uncooperative tax havens."
The United Bank of Switzerland is already under great duress from Washington to release information on an estimated 52,000 Americans who use UBS as a secrete hideout for their riches. The bank has already agreed to release information on 250 of these U.S. citizens. It is doubtful that the Obama administration will be satisfied with that. All governments now need much more tax money than they now reap. So it's not only UBS and Switzerland that are the targets. Not by a long shot.
Prine Alois, the dynastic ruler of Liechtenstein, has opined about why coercion is not the way to handle this matter. It will flee somewhere else, he says. He wants there to be standards by which, over time, "a fresh approach" would be "much more productive than threats of discovery." But these tax havens are in trouble either way. They distrust attention. And, whatever ultimately happens, they are facing enormous drops in their revenues.