Bloomberg News

Geneva Private Bank Pictet Says Not U.S. Tax Probe Target

May 06, 2012

Pictet & Cie, Switzerland’s largest closely held private bank, said it’s not a target of a U.S. tax- evasion probe after Swiss media suggested the firm may be under investigation.

The company “vigorously” rebuts any allegation it is being targeted by U.S. tax authorities, including the Internal Revenue Service, Pictet said in an e-mailed statement today. “Pictet confirms that no accusation has been levelled against it by the U.S. authorities, including the IRS.”

Switzerland and the U.S. are holding talks to resolve a Department of Justice investigation involving 11 Swiss financial firms including Credit Suisse Group AG, the nation’s second- biggest bank, Julius Baer Group Ltd. and HSBC Holdings Plc’s Geneva-based wealth unit.

Credit Suisse set aside 295 million Swiss francs ($321 million) for U.S. tax matters in the third quarter of last year. Julius Baer, the wealth manager established in 1890, said the cost of the investigation isn’t “reliably assessable” after the DoJ indicted two employees of the Zurich-based firm. HSBC said last week fines and penalties related to the probe “could be significant.”

Newspaper Report

Pictet, which wasn’t on the original list of 11, took on millions of dollars of undeclared money from Americans including former clients of UBS AG, Switzerland’s biggest bank, between 2007 and 2009, SonntagsZeitung reported May 6, citing documents from an Arizona court.

Pictet may now be in the DoJ’s sights after a prosecutor in the U.S. state began investigating two businessmen and a California-based lawyer suspected of hiding money with Swiss firms, the Zurich-based newspaper said.

Pictet said it supplied a “complete file” on the issue referred to in the newspaper in full compliance with U.S. and Swiss authorities in 2010. The matter concerns relationships started in 2007 by an external asset manager, Pictet said.

Pictet isn’t under investigation by the DoJ, Frank Renggli, a spokesman for the bank, confirmed separately by e-mail.

The firm was overseeing 247 billion Swiss francs for private and institutional clients at the end of 2011, making it Switzerland’s third-largest wealth manager.

To contact the reporter on this story: Giles Broom in Geneva at gbroom@bloomberg.net

To contact the editor responsible for this story: Frank Connelly at fconnelly@bloomberg.net


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