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The US and Switzerland have ended their long-standing stalemate by sharing information about client investments.
The agreement comes amidst the regulatory inspections of at least eight Swiss companies doing business through US regulated entities, said three people with knowledge of the issue. The Securities and Exchange Commission exams include small managers and large investment group Vontobel, which included on-site testing in Switzerland over the past year.
The SEC said the trial has not been published and will not “confirm (their) presence or existence.”
Vontobel declined to comment.
The two countries have a complicated relationship over information about American clients who have long hidden assets in Switzerland accounts to avoid US taxes. Swiss companies paid billions of dollars in fines in 2013 after the two countries reached an earlier agreement on sharing information.
The US lifted a moratorium on approval of a new Swiss investment advisor on Tuesday to pursue a lucrative American wealth management business.
In 2020, the SEC stopped processing applications from Switzerland-based investment advisors. It said it was concerned about the agency’s ability to provide the data it is seeking and the regulator’s own ability to conduct testing on-site.
“These applications have been struggling for years and it’s been a while since we resume this process,” said Paul Atkins, chairman of the SEC. “We look forward to expanding access to US capital markets.”
The announcement on Tuesday came from negotiations between Washington and Swiss financial regulators, the SEC said. The terms of the new agreement allow US regulators to directly access client information from Swiss companies.
The SEC move is booming by wealthy Americans in the US and abroad amidst the uncertainty sparked by Donald Trump’s administration. Swiss companies wanting to capitalize on that demand are looking for other ways to access the market, such as acquiring existing SEC registrants.
The Swiss exam began mid-last year and continued this year. “The fact that they chose this number is rare, in some cases, they came physically to look into some documents,” said one of the people closely involved in the situation.
“The suddenness of the announcement is surprising,” said Unlieb Gott, an expert in Swiss wealth management services for American citizens. “A moratorium was not needed because several SEC licensed Swiss manager exams allowed us to get information that regulators had long wanted.”
