Wegelin, a Swiss bank founded in 1741, said it would close its bank operations after pleading guilty to helping hide $1.2 billion from U.S. tax authorities.
The 272-year-old bank agreed to pay $57.8 million to settle charges that it helped U.S. citizens hide assets from the IRS and said in a statement, "once the matter is finally concluded, Wegelin will cease to operate as a bank."
Swiss lender Raiffeisen purchased most of Wegelin's business in 2012, setting up the possibility the bank would close, The Financial Times reported Friday.
While pleading guilty on behalf of the bank in a court appearance Thursday, Otto Bruderer, a managing partner of Wegelin, said the bank "intentionally opened and maintained non W-9 accounts for these taxpayers with the knowledge that, by doing so, Wegelin was assisting these taxpayers in violating their legal duties."
"Wegelin was aware that this conduct was wrong," he said.
The $57.8 million settlement includes $20 million for restitution, $15.8 million in forfeited fees the bank earned from clients it was helping evade taxes and a fine of $22 million, the Times reported.
The case is part of an extended investigation that began when a former UBS banker turned whistle blower helped U.S. authorities challenge UBS on helping U.S. taxpayers hide assets from the IRS. That case ended with UBS paying $570 million in a settlement and turning over the names of thousands of clients to authorities, which shattered a long-established pledge of secrecy among Swiss banks.
Currently, U.S. authorities are investigating Swiss banks Julius Baer and Credit Suisse for possible tax evasion schemes.
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