U.S., Switzerland avoid face-off over bank secrecy

WASHINGTON – U.S. and Swiss negotiators have initialed a settlement that averts a legal showdown over the U.S. government’s landmark challenge to Swiss bank secrecy, a government lawyer said Wednesday.

The U.S. government had sought a federal court ruling compelling Switzerland’s largest bank, UBS, to turn over the names of Americans suspected of dodging taxes through the use of 52,000 secret accounts.

In a conference call Wednesday with the federal judge presiding over the case, Justice Department lawyer Stuart Gibson said the parties had initialed agreements and that they would ask the judge to dismiss the matter when the final documents are signed.

Terms of the deal were not immediately disclosed.

The announcement followed a long-running legal battle that had already undermined Switzerland’s legendary bank secrecy.