At the request of U.S. law enforcement, Swiss authorities have been ordered to surrender documents pertaining to at least 18 banks and an unknown number of American businesses, according to Bloomberg News.
The increased pressure from the American Justice Department comes after widespread allegations of corruption throughout the Swiss banking infrastructure.
While none of the 18 banks have been implicitly accused of anything, an official statement from Switzerland’s financial regulator, Finma, states that the organization is “aware of the case and is in touch with several banks” to determine whether or not there was any wrongdoing.
According to the Irish Examiner, among the alleged activities that authorities are most concerned about are money laundering and bribery.
Businesses and wealthy individuals all over the world store money in Swiss banks for reasons of security, privacy, and economics. Currently, there are more than 26 million businesses currently operating in the U.S., and some of those may have such offshore accounts.
American businesses and businesses the world over are attracted to the prospect of storing money in overseas bank accounts because it is often cheaper, easier to maintain, and less regulated than banks in the United States, according to The Columbus Dispatch.
Speaking about the difficulties inherent to operating a bank or business under such heavy regulation stateside, president and CEO of the Community Bankers Association of Ohio Robert Palmer said, “It’s disastrous to the local economy, not just rural economies, but the larger metros.”
Offshore banks allow businesses worldwide to make transactions without having to submit rigorous documentation to any governing body.
But with so many American businesses potentially involved, the American Justice Department remains committed to making sure there is no illegal conduct on the behalf of the Swiss banking industry.