Swiss lawmakers criticise officials over UBS crisis

31st May 2010, Comments 0 comments

A Swiss parliamentary committee criticised the government on Monday for being slow to react to the financial crisis which nearly brought down the country's biggest bank UBS.

The controls committee also rapped UBS for its "misconduct" which led to a US lawsuit requiring the bank to reveal client data of US taxpayers.

"On the part of the government, the report of the controls commission determined that there were significant management deficiencies in the handling of the crisis," the committee said in a summary of its 363-page report.

"During around five months -- April 2008 to September 2008 -- the government was not taking care of the financial crisis, the chief of the Federal Finance Department was taking the lead on crisis management," it said.

Committee member Pierre-Francois Veillon said during a press conference that the government was "too late in tackling" the issues.

The committee also took aim at UBS, which had to turn to the state for a bailout during the financial crisis, and simultaneously became embroiled in a lawsuit with US authorities for abetting tax evasion.

"There has been misconduct by UBS and employees of the bank," it said, also criticising a "lack of respect" for Swiss legislation in the United States.

"The controls committee strongly condemns both behaviour," it added.

It also called for the financial market regulator FINMA to look into how many members of UBS's top management might have been aware of the US tax violations.

In a statement, FINMA said it would examine the conclusions drawn in the parliamentary report and give its position on the findings by the end of 2010.

The Swiss government announced in October 2008 an emergency 60-billion-dollar (47.4-billion-euro) aid package to prop up UBS, which was one of the biggest losers from the US subprime crisis.

Shortly afterwards, US tax authorities filed lawsuits to force the bank to hand over information on 52,000 clients.

In a landmark settlement brokered by the the Swiss government, the bank agreed to hand over data of around 4,450 US clients to the US authorities.

© 2010 AFP

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