Attacks on Romney’s account have Swiss worried

Stashing money in the vaults of Swiss banks has become part of Hollywood folklore RDB

As the United States presidential campaign heats up, Switzerland is finding itself the centre of attention in what is an increasingly bitter fight between the two candidates’ claims to the seat of power.

The revelation that presumptive Republican candidate Mitt Romney had $3 million (SFr2.94 million) in a Swiss bank account has led to unrelenting attacks from President Barack Obama’s re-election team that he hides his money overseas to avoid paying tax.

In recent days, the Obama campaign has ramped up its attacks on Romney, accusing him of lacking transparency in having several foreign bank accounts and refusing to release more than one year of tax returns. A recent attack ad from the campaign contrasts Romney singing “America the Beautiful” while flashing up a headline saying: “He had millions in a Swiss bank account”.

But although Romney closed his Swiss account in 2010 and revelations have also come to light that he has money in other foreign accounts, including in the Cayman Islands, it is the Swiss account that has been bandied about by his opponents like a dirty word.

“The Cayman account came out later than the disclosure of Mitt Romney’s Swiss account,” Greg Wierzynski, a Republican former advisor to the Financial Services Committee of the US House of Representatives and former reporter for Time magazine, told swissinfo.ch.

“The fact is that, in the minds of people here, Switzerland is the country most easily associated with bank secrecy, tax evasion and rich people who want to hide their money.”

Hollywood cliché

Head of the government’s communication agency Presence Switzerland, Nicolas Bideau, described the attention on Romney’s Swiss account as “confirmation of a Hollywood cliché which already exists”. Namely that if you want to hide your money from the taxman, send it to Switzerland.

His assessment was supported by George Edwards, a political scientist at Texas A&M University who said that Switzerland’s long term success had led to the country being a “fabled place to land your money”.

“That image is part of popular culture, here,” Edwards told swissinfo.ch. “You see it in the movies. Every time there’s a need to hide money, the idea of a Swiss bank account comes up. To hide money, the standard is the Swiss account. It just evokes notions of avoidance of scrutiny.”

Wierzynski said US media attention on UBS’ admission in 2009 that it helped US clients hide money from the taxman and on American pressure on Switzerland to disclose details of accounts held here by rich Americans, reinforced the association of secrecy and tax evasion tied to Swiss bank accounts in the minds of Americans.

“And in the minds of the American media might also be the old story about the Holocaust assets that still lingers on,” he said. “I don’t think that many Americans have a bad image of Switzerland as a whole. The elites, certainly, know better. But you do have a lot of people here who see Swiss banks as a haven for the super wealthy and tax dodgers.”

Image problem?

Bideau said that analysis of the media attention on Romney’s Swiss account revealed that the attacks are less an attack on Switzerland itself and more about calling into question the candidate’s patriotism given his penchant for having his assets in foreign bank accounts. Additionally, insisting on his Swiss bank account is aimed at underscoring the supposedly out-of-touch wealth of the Republican candidate, he said.

“Nevertheless it’s true that it is an official position and that our embassy in Washington has pointed out to Mr Obama’s people that it is not very flattering to Switzerland,” Bideau told swissinfo.ch

Bideau said the issue is particularly sensitive given that Switzerland and the US are in discussions to find a solution to the current impasse on banking and taxation matters between the two countries.  

“In a general sense, the relations between Switzerland and the US on financial questions are sensitive,” Bideau said.

Unrelenting

Despite the protestations of the Swiss, attacks on Romney for having held a Swiss bank account are likely to continue right up to election day in November, Edwards said.

“The problem of Swiss and other foreign accounts is that it leads to questions such as: did the candidate put his money there so he doesn’t have to pay taxes? In the case of Mitt Romney, his lack of transparency gives the story legs. He has made one year of his personal finances available, but no others, while everyone knows he’s very wealthy,” Edwards said.

“In battleground states, surveys show that this line of attack resonates with some voters. From the Obama campaign perspective, this is very favourable feedback and it encourages them to continue doing it.”

Wierzynski said the line of attack on Romney’s foreign accounts was important for the Democrats as a means of mobilising the left of their own party and diverting attention from Obama’s record as president.

“We can expect more of this because it’s a fundamental base of attack against Romney,” he said. “I’m not sure that Switzerland will figure prominently in the [autumn], but it is and will be a piece of a caricature of Mitt Romney. In the context of the election campaign, it’s just a way to stir up controversy.”

Attacks on Swiss Mitt

“This is a man who says President Barack Obama is out of touch. Out of touch with the needs of the American people. This coming from a man who until recently had a Swiss bank account and millions of dollars invested in the Grand Cayman Islands … beyond scrutiny.” Vice President Joe Biden.

“No one in Youngstown, Ohio has a Swiss bank account. Or Akron, or Cleveland, or down the Ohio River, or in the Appalachian part of Ohio. And to think you would make a lot of money offshoring jobs and then put it in a Swiss bank account is really appalling to a lot of people.” Democrat congressman Tim Ryan

“He is the first and only candidate for US president with a Swiss bank account, with tax shelters.” Democrat senator Dick Durbin

“Americans need to ask themselves, why does an American businessman need a Swiss bank account and secretive investments like that?” Democratic National Committee chairwoman Debbie Wasserman Schultz

“He offshores most of his own personal investments, presumably to shield them from taxes. I don’t know about you, I pick a bank because there is an ATM near my home, right? Mitt Romney has a bank account in Switzerland.” Obama campaign adviser Robert Gibbs.

Films featuring Swiss bank accounts

The Bourne Identity trilogy

James Bond series

Da Vinci Code

Munich

The Saint

The Spanish Prisoner