By Michele Fletcher, June 30, 2014
This week’s optimistic hubbub surrounding the Swiss-Indian information exchange seemed to mark a new beginning for Swiss transparency and a major breakthrough in India’s hunt for black money. Unfortunately, little happened: Switzerland admitted only the amount of money Indians had stashed in Swiss banks and rejected requests for information regarding specific account holders.
Despite the media’s rude awakening when the Swiss revealed that accountholder information would remain confidential, this result should not have been surprising. A quick look at the Swiss attitude towards information exchange—especially automatic exchange of information, the OECD’s biggest step towards financial transparency—shows that the media’s optimism was premature. Instead, India’s request to Switzerland should be viewed as a litmus test of the Swiss attitude towards the future of banking secrecy.