Marc Schippke: How to open a Swiss bank account for US tax residents. Thank you very much for taking the time to watch this very interesting interview. We are here on a bright summer day in beautiful Lugano, the lake of Lugano, just behind us. And with me, I have Enzo Caputo, who is one of the most experienced Swiss banking lawyers, with more than 30 years of experience. So thank you very much Enzo for taking the time.
Enzo Caputo: Thank you for the invitation. I’m very happy to answer these questions and to speak today about how to open a Swiss bank account for US persons with residency in the United States of America.
Marc Schippke: So what is the problem? Why is it so difficult for US tax residents to get a foreign, an offshore or a Swiss bank account? For Germans, it is tough from the Swiss side, because of compliance and they want to have a lot of documents and you have to prove the source of income and everything. But for Germans and British people, for example, it’s much easier in total than for US, Americans. Why is that?
Enzo Caputo: This is because Swiss banks had a lot of bank accounts with Americans, with non-tax compliant money, which means with black money. They had a lot of black money in previous years because Switzerland had the Swiss bank secrecy. So they had many clients from the United States with undeclared assets. They didn’t pay taxes in the United States and obviously the IRS, the tax authority in the United States, was not happy about that. And the Americans started a campaign against Swiss banks and started to distribute fines in millions, even billions.
It started with Jeffrey Newman. He was the first US prosecutor who prosecuted UBS with a $780 million fine. This was the first fine against UBS. UBS made the deal at that time with the IRS. Then for the first time in the history of Swiss banking, 4,500 Swiss bank accounts with US beneficial owners were disclosed to the authorities of the United States. So this was the first time in history Swiss banking secrecy-
Marc Schippke: That was 10 years ago.
Enzo Caputo: This was roughly 10 years ago, exactly. First time in history, Swiss bank secrecy was lifted. This was a scandal and this was a game changer in the history of Swiss banking, of course. And at that time, Swiss banks were so scared because still today they are paying fines. There was a real campaign that was even the non-prosecution program for Swiss banks started by the Department of Justice from the United States.
The Swiss banks had the opportunity to take part in a certain program to not be criminally prosecuted. We had, as you remember, we had even Credit Suisse who declared themselves guilty for tax evasion, even as a criminal organization. This never happened before, this was unique. So after all these things happened, Swiss banks were very scared. They rejected any account opening of Americans. They didn’t want anything to do with America-
Marc Schippke: FATCA documents.
Enzo Caputo: … FATCA and all these regulations, very sophisticated. High risk, legal risk, and any type of risk from the US side. So Swiss banks, they always rejected US persons. And still today, it is in the minds of US people, “No, it’s impossible. It’s impossible today to open accounts for US people.” But that’s not true because things have changed. So what are the rules to open a Swiss bank account as an American, as a US resident.
The rules are the US client has to have residency in the United States of America. And he has to work with the Swiss bank, who is licensed in the US, who has an SEC license. The SEC is the Security Exchange Commission, and the Swiss bank should have such a license. And he can only open a Swiss bank account if he works with an external asset manager, having a discretionary asset management mandate.
So even the asset manager needs an SEC license. So what happened in the last two, three years, it’s happened that many Americans came again to Switzerland, but this time not with black money, they came here with fully legal money, fully tax compliant money. They are coming to Switzerland for asset protection because some clients are not happy about Trump, so they do asset protection.
They open accounts in Switzerland to diversify their worldwide assets, to not leave all the assets under the rules of the US government. So they also want to have some assets under other rules, for example, the rules of the Swiss government.
So they started… US persons are coming again. Important amounts of money are coming from the United States to Switzerland. Not only private clients, but even US companies are also investing again tremendously in Switzerland because it’s very attractive for asset protection.
And now the US desks of many banks, for example, Bank Vontobel, Bank Pictet, all these banks, have applied for the SEC license. There are also more and more asset managers applying for SEC licenses, to be legitimated, to receive these US clients. And we know exactly the banks who work, who accept US clients, who bring good services. But this time tax compliant, nothing for tax dodgers, a hundred percent legal.
Marc Schippke: So just to summarize, in the past the Swiss banks used the gray methods, so to speak, sometimes even black. And so the problems-
Enzo Caputo: From the US perspective, not from the Swiss. From the Swiss, it was legal, of course.
Marc Schippke: But the US authorities had problems with the procedures. Not with the banks itself, not with the country itself, just with the way they operated. So now they changed the way of operations to a US-compliant way-
Enzo Caputo: US-compliant way.
Marc Schippke: … and now they are satisfied. The IRS is satisfied that as long as you pay your taxes in the US, you can still use a Swiss bank account for various reasons. We are getting there in a moment. Obviously, it is a great idea to bring your assets for asset protection, to Switzerland, and to protect your assets in the Swiss Franc. But you still have to pay your taxes to the IRS.
Enzo Caputo: You have to be tax compliant. You have to make the Form W-9, which is the form disclosing the identity of the beneficial owner. The Americans know this form, the W-9. With this form, you authorize the bank to disclose your information to the US tax authorities, and you are fully tax-compliant. But you can take all the benefits of Swiss banks.
So more and more Swiss banks are happy to receive US clients. We are also helping US clients to get a Centurion black card. We know that US persons, Americans, like this Centurion black card, especially the European one. And the service we offer is to help the US client to find the right Swiss bank with the SEC license, with good service. And to find the right asset manager, also with the license, with professional experience, who brings an asset manager who can deliver results.
And we help the client to make the right decisions, to work with the right people, with the right bank, and with the right asset manager, and be fully tax-compliant. We help him with the pricing; we will help him to negotiate good pricing because the pricing is always negotiable, even in banking.
So our advice to you is don’t accept the standard terms and conditions offered by you by the Swiss banks, everything is negotiable. The higher, more important the assets are, the better the pricing will be. And we’ll give our support. We bring you, we will pick you up at the airport. We will bring you to the bank. We introduce you to the asset manager, we help you to fill up the forms to be tax-compliant, and to do everything right.
We help you to select the right bank, depending on your business and depending on your economic background, we select the best bank for you, that is licensed in the United States with the SEC. And everything should be according to the books and according to the law, of course.
Marc Schippke: So just to summarize again, if you are interested in opening up a Swiss bank account with our support, then the procedure is as follows. You just have to be sure you really want to do this. Obviously, if you’re just interested, there are many ways to get some information on the internet, et cetera.
Because this is a very time-consuming process, it’s very good to know upfront. Obviously, we help you to make up your mind. It doesn’t make sense to call you, “Can you give me some information on Swiss banking?” Because you are super busy.
So we help you guys to understand if this is the right location, the right destination for your asset protection. Maybe you are looking for other solutions that are a bit more affordable, that is accepting you with 100,000 or $50,000 in assets. Obviously, Switzerland offers you the best solution if you are wealthy.
Enzo Caputo: Starting from one million. You should start from one million assets.
Marc Schippke: That’s why I’m saying this.
Enzo Caputo: It makes no sense to open a Swiss bank account for asset management with $500,000. It should be a million at least, because the Swiss asset manager has to diversify the investments, lowering the risks. So he has to buy different shares, different bonds, and different instruments.
He has to diversify for your own protection. He has to diversify the risks. And to do a good risk diversification, you need an important amount. You need at least a million to make a good diversification to protect your interest. Otherwise, you have to invest in investment funds, but investment funds are very expensive.
So the hidden fees in the investment fund will eat the performance of your portfolio. So, therefore, we strongly advise you to start in Switzerland, but you should start with at least $1 million. This is the minimum portfolio size. Otherwise, Switzerland is not the right place.
Marc Schippke: There are other destinations as I said.
Enzo Caputo: There are other destinations. You can work with Switzerland, you should start from one million and more.
Marc Schippke: So this is the first step. Make up your mind. If you then say, yes, I have above one million US dollars in assets, to protect and to invest for maximum security and profits. Then the second step will be to get in touch with us to arrange a personal video call first.
Enzo Caputo: A video call first.
Marc Schippke: It’s the best way.
Enzo Caputo: We will ask you, what is your business? What is your background? From the client, to understand what he is doing. Source of funds, to be compliant with all the money laundering legislation. And then we will help you to prepare the documents for the bank.
We will tell you exactly. We will send your questionnaire. We will pose some questions. We need the answers. We need a short CV, we need your passport copy. We do all the preliminary checks. Before we present you to the bank, we have already done everything. We do our homework.
And then when everything is ready, we present you to the bank. Not before, because it can be risky if you go to the bank and the documentation is not fully accomplished. If the documentation is not finished. There are certain risks of misunderstanding. The banks are very nervous.
Marc Schippke: Let me maybe bring my personal experience to this.
I opened several accounts worldwide; in Hong Kong, Switzerland, and the US as well, being German and a Swiss resident.
But even myself, I got rejected three times all over the world. And I even lost two bank accounts, one in Switzerland and one in Hong Kong. And from my experience, I can tell you, it is crucial. It is absolutely crucial that you do your homework or you have somebody with a checklist, with 30 years of experience, with other knowledge, what can go wrong. So that this person, this consultant, is helping you to be prepared.
You need a checklist, you need templates, you need briefings. You need a lot of preparation to do this right. Because, if you do it wrong, they are all connected, they are communicating. So if you go there and you do it completely wrong, it is very unlikely you will find another bank. So it’s really good to find-
Enzo Caputo: You can be blacklisted, for example. Or even, you can be reported. A suspicious activity report can be the result. This is very bad. A suspicious activity report is very bad because then your account will be frozen. You are suspicious of money laundering just because of a misunderstanding, which is very stupid. So these things should be avoided.
Marc Schippke: So these suspicious activity reports should be avoided?
Enzo Caputo: It’s very important.
Marc Schippke: They are like computers. They behave like computers. They have a checklist.
Enzo Caputo: According to the books.
Marc Schippke: … according to the books. It’s like, “All right.” So they just follow the rules. And these people working with the banks, they don’t own the bank, they don’t manage the bank, they’re working for the bank. So they just have a manual to follow. They just have rules and a checklist to follow.
And we have this material, we know what they want. So together with you, we will help you to do this right, and to avoid any costly mistakes, so that you do it right in the first place.
And I can really not highlight enough, that it is extremely important to have a super experienced partner supporting you. In my past experience, I had three, or four agents and consultants working with me that seemed to be very experienced. They seemed to be very professional, but they were not. And that cost me a lot of money, a lot of headaches, a lot of pain, and wasted time. So here you have the strongest potential partner to do this right.
Enzo Caputo: Thank you very much. That’s true. And what I have to say to you, you will also, if you work with us… If we introduce you to the right bank, to the right asset manager, you will obtain a much better price and first of all much better return. If you go directly, you will have a higher price, for sure. This is guaranteed because the asset manager we work with has many clients with the banks. You will pay less.
Marc Schippke: So without you, it’s higher?
Enzo Caputo: Without me, it’s higher because, with our asset manager, they have a package price because they have many clients. One client has 20 million, the other client has five million, the other client has 30 million, and the other 10 million.
So they have many assets under management and they can negotiate a much better price, a package price with the bank. So, if you come to us, what we do is we will prepare all the documentation to be tax-compliant.
We will go together, with the estimate actually, we will go to the bank and we know exactly the price you will pay. We can negotiate a very good price, much cheaper. For our clients, we always agree to a very transparent all-inclusive pricing..
Marc Schippke: So it’s going to be very effective, not time-consuming for them because you do all the hard work. They just have to get prepared. They have to prepare the documents you need. If they follow your advice, it’s going to be a success, because you know which banks to address for which type of clients.
Some might be older, some might be younger, some might be very wealthy, and some start out. Having the first million that has been made, they want to grow it in the next years and decades. So these are different kinds of clients, and you know which client to send to which bank. And then with your support, it would take how long to get this open?
Enzo Caputo: Normally an account opening procedure, it takes from two weeks to two months, this is the range. Depends on the bank. A Credit Suisse account opening… With Credit Suisse or with UBS, it will take two months. There is no-
Marc Schippke: Because they got a lot of fines in the past.
Enzo Caputo: That is also the reason we don’t advise you to open an account at Pegasus or UBS because these are very big banks and over-regulated banks. And the procedure and decision-making process is very long and sophisticated. So we like to work, not with the smallest banks, but also not with the biggest banks.
Marc Schippke: Like medium, experienced?
Enzo Caputo: Medium-sized bank with experienced people. And what we do is, we check the bank.
What we check, also the people working for the bank. So we want to work with professionals, with people who are not making mistakes, because bad mistakes will cost a lot of money for everybody involved. So we will avoid these mistakes, and we will get them at the prices at the end of the day, and successful asset management for the long-term.
Opening a Swiss bank account, even as an American, it’s a long-term project. It’s a long-term project including the next generation to come. The average duration of a Swiss bank account is 17 years. So it’s longer than a marriage. So a bank account normally takes… The duration is 17 years. So it’s a long-term project.
You have to do it for a long time. It’s an important decision. With which bank do you work with, and which asset manager do you work with. So that’s why we don’t advise you to work directly with the bank, we always advise you to take an external manager because the internal manager of the bank can change the job. He will be with the bank for a half year, a year, then he changed the job-
Marc Schippke: They’re changing banks quite often, right?
Enzo Caputo: They’re changing banks very often. Swiss private banks, because they are under tremendous pressure anymore. And now these times, because the Swiss bank secrecy is not as strong as it was before. So they have to really fight for new money. It doesn’t come automatically as it was before. They have to fight, but there are still successful Swiss banks, and they are increasing.
So there are a record amount of new assets coming into Switzerland. So just to give you a figure, 30% of all bankable assets in the world in offshore banking are managed by Swiss banks. 30% of all offshore money is managed by Swiss banks. So this speaks for itself that Swiss banks are the best in the world. I cannot say different, that’s the truth.
Marc Schippke: Because-
Enzo Caputo: There is no alternative.
Marc Schippke: … it’s also the reason that I moved from Germany to Switzerland because there’s reliability. Forget about the money, forget about the banks, you can just trust the government. The government gives you a rule; it’s transparent, direct, democracy.
So this law has been implemented because the people want it to be implemented. So it’s not something the government puts upon the people, and then there might be some rebels and some uproar against it. And then you have thousands of people demonstrating. You don’t see this really, very rarely in Switzerland, because people are interacting with the government, with the system. That’s one of the main reasons why I have moved to Switzerland.
Enzo Caputo: That is a direct democracy.
Marc Schippke: Direct democracy. They are also directly responsible, the people, for these kinds of regulations things. If they want something to be really regulated, then it happens because the people want it. They don’t just do it against the people. That is very important to me because I’m a liberal philosopher. I really love liberal entrepreneurship.
So I want to have a country that supports this idea of free trade or free banking. But still, on the other side, everything is secure, everything is reliable. You just know that if you follow the rules, everything is going to be fine. You can know the rules. In many other countries, with corruption, with non-transparency, there’s always a big risk involved, because you don’t know what might happen.
Enzo Caputo: Corruption is very… Let me give you an example. Can I give you a real example of corruption? I had a client in Russia, a very successful real estate entrepreneur. And what they did to not spend too much money, instead of taking a Swiss company to hold the supermarket, the Russian supermarket was held by a BVI company.
Marc Schippke: British Virgin Islands?
Enzo Caputo: … British Virgin Island company, and not by a Swiss company, because of cost reasons. Obviously, the BVI company is cheaper than a Swiss company.
But the value of the supermarket was 80 million. So the supermarket had a market value of 80 million. So then what happened? Some fraudsters were corrupted, sent some people to the BVI, changed the people in the company register, and put different directors in these BVI companies.
These directors changed the ownership in Russia, in the land registry. And suddenly the supermarket was stolen and then it was sold to other people. So these clients lost the supermarket.
Marc Schippke: And then-
Enzo Caputo: … lost the supermarket, just because they used a cheap BVI company instead to take a Swiss company to hold the supermarket. They made a big mistake taking a cheap BVI, just for a couple of 1,000 dollars, paying less.
But this is not the right way to do business. So if you hold such valuable assets, you should take a Swiss company located in a stable nation, in a stable country without corruption. You can rely on a proper commercial register. In Switzerland, it will never happen that you can go to the commercial register, and giving money to the guy there… Corruption will not work in Switzerland.
Marc Schippke: It’s impossible.
Enzo Caputo: … to the officer, bribing them, paying money. This will not happen.
Marc Schippke: There are two things. Many times in life, if you choose the cheap solution, it’s going to cost you way more. In many ways of life. And on the other hand, how would you sue anybody on the British Virgin Island? How would you find a lawyer? You can find a UK-based lawyer that helps you there-
Enzo Caputo: They spent a lot of money on lawyers, and in the end they were not successful. They failed. After two years they have not recovered at the supermarket. They lost the supermarket. It was incredible for me, itself, to see, wow, how this is possible. But in Russia, many things are possible.
Marc Schippke: And even if they are frauds… Obviously, frauds are everywhere, private people doing fraud-
Enzo Caputo: Criminals, these are criminals.
Marc Schippke: … Criminals. You also have criminals in Switzerland, obviously. But there is a system against these people. Switzerland doesn’t care where these people are flying to. They get these people, they find these people, for sure, working with Interpol, et cetera. And then they bring them to jail. They bring them to justice.
So even if there are some cases of criminal activities, also from Switzerland, they have a very strong legal system protecting your interests. And this is definitely not going to happen again in this industry if it ever happens in the industry. So that’s why I can really suggest that you just make up your mind if this is interesting to you.
Thank you again for watching the interview with Enzo.
Enzo Caputo: Thank you.
Marc Schippke: And if you’re interested, just fill in the form. Apply for a free consultation. So we just get in touch and we talk about your interest and your plans for future asset protection. So thank you so much for taking the time.
Enzo Caputo: Thank you, it was a great pleasure to inform your audience. Thank you very much
Marc Schippke: And looking forward to working with you guys. Have a wonderful day.
Enzo Caputo: Thank you. Bye-bye.