Swiss Bank Independent Examiner

(SWISS BANK)
INDEPENDENT EXAMINER
and Summary of the “Program for Non-Prosecution Agreements or Non-Target letters for Swiss Banks” as
announced on August 29, 2013 by the U.S. Department of Justice and the Swiss Federal Department of
Finance

International
Accounting &
Compliance
GENEVA

|

HONG
KONG

|

SEATTLE

|

SHANGHAI

LEGAL NOTICE
IMPORTANT LEGAL INFORMATION PLEASE READ

This
presentation
is
prepared
for
general
guidance
only,
and
does
not
constitute
the
provision
of

accounting,

legal
or
tax
advice
in
any
manner,
written
tax
advice
under
U.S.
Internal
Revenue
Service

Circular
230,
or
any
professional
advice
of
any
kind.
“Gray
International”
or
“Gray”
refers
to
Gray
CPA,
PC
(a

U.S.
CertiIied
Public
Accounting
Iirm)
and
Gray
International
Ltd
(a
Hong
Kong
Limited
Company).

The
information
provided
in
this
presentation
should
not
be
a
substitute
for
consultation
with
qualiIied

professionals
who
understand
your
situation,
as
it
will
differ
from
others.
In
addition,
when
making
any
tax

planning
or
legal
decisions
you
should
consult
with
your
own
legal,
tax,
accounting
and
other
professional

advisors.

This
presentation
has
been
provided
as
a
courtesy,
and
therefore
while
care
has
been
executed
in
the

preparation
of
this
information
Gray
CPA,
PC
(U.S.),
Gray
International,
Ltd.
and
all
of
their
afIiliates
make

no
representations
as
to
its
completeness,
accuracy
or
the
timeliness
of
the
information
and
takes
no

responsibility
to
update
this
information,
such
information
is
being
provided
without
warranty
of
any
kind.

The
U.S.
Department
of
Justice
and
the
Swiss
Federal
Department
of
Finance
has
not
reviewed
this

document,
does
not
endorse
or
in
any
other
manner
render
an
opinion
on
the
merits
of
Gray’s
offering
of

independent
examiner
services,
and
any
representation
to
the
contrary
is
unlawful.

For
more
information
about
us,
please
visit
us
at
www.grayintl.com.

©
2013
Gray
CPA,
PC
and
Gray
International
Ltd.
with
all
rights
reserved,
this
document
shall
not
be
reproduced
or
distributed
without
the

express
written
permission
of
Gray
CPA,
PC
and

Gray
International,
Ltd.

International

Accounting &

Compliance

WHO WE ARE
OUR
PROFILE

Gray
International
(“Gray”)
is

an
international
network
of

public
accounting
and

consulting
Iirms
based
in
the

U.S.,
Hong
Kong,
China
and

Europe.
Gray
was
started
over

10
years
ago
in
the
U.S.
(via
its

predecessor)
and
took
the

form
of
Gray
International
in

2013
as
the
result
of
the

networking
of
multiple

independent
practices
and

professionals.

Gray
provides
international

accounting
and
compliance

solutions
in
the
U.S.,
Americas,

Asia
and
Europe.
Gray
focuses

on
U.S.
accounting,
tax,
and

governmental
compliance
for

multinational
companies,

investors,
U.S.
persons
living

overseas
and
foreign
investors

and
companies
investing
in
or

moving
to
the
U.S.

Gray
also
consults
on

compliance
with
U.S.
laws
for

businesses
and
Iinancial

institutions
overseas
such
as

the
Foreign
Corrupt
Practices

Act
(FCPA)
and
the
Foreign

Account
Tax
Compliance
Act

(FATCA),
the
IRS
Offshore

Voluntary
Disclosure

Program,
and
the
Program
for

Non-‐Prosecution
Agreements

or
Non-‐Target
letters
for

Swiss
Banks.

Gray’s
principals,
partners,

and
employees
have
served

clients
worldwide.
Gray
has

ofIices
in
Geneva,
Hong
Kong,

Seattle,
Shanghai
and
plans
to

open
an
ofIice
in
Singapore
in

late
2013.

Gray’s
U.S.
public
accounting

Iirm
(Gray
CPA,
PC)
is

registered
with
the
U.S.
Public

Company
Accounting

Oversight
Board
and
is
a

member
of
the
American

Institute
of
CertiIied
Public

Accountants
and
the
Center

for
Audit
Quality.

For
more
information
about

us,
please
visit
us
at:

www.grayintl.com

International

Accounting &

Compliance

WHAT WE DO
OUR SERVICES

AUDIT AND ATTEST SERVICES
INTL. FORENSIC ACCOUNTING

U.S. TAX COMPLIANCE
U.S. FATCA COMPLIANCE
INTL. TAX STRUCTURING
U.S. FCPA COMPLIANCE

International

Accounting &

Compliance

WHAT WE DO

OUR
PRACTICE
AREAS

AUDIT
AND
ATTEST
SERVICES

INTL.
FORENSIC
ACCOUNTING

U.S.
TAX
COMPLIANCE

Our
experienced
auditors
provide

extensive
experience
auditing
public

and
private
companies
in
the

developed
and
developing
markets.

Let
us
put
our
extensive
experience

operating
in
the
U.S.,
Asia,
Europe
and

the
Americas
to
work
for
you.

Our
forensic
accounting
services
are

designed
to
providing
vigilance
before

the
fact,
reconstructing
and
tracing

records
after
the
fact,
and
preparing

for
trial
once
the
Iindings
are
made.

Our
team
of
experts
are
available
for

worldwide
engagement.

U.S.
FATCA
COMPLIANCE

INTL.
TAX
STRUCTURING

Gray
provides
extensive
U.S.
tax

compliance
solutions
to
clients

worldwide.
We
work
with
individuals,

family
ofIices,
investors,
Iinancial

institutions,
multinational
companies

and
domestic
(U.S.)
businesses.

Let
us
guide
you
through
the
maze
of

complex
U.S.
tax
compliance.

No
single
piece
of
U.S.
legislation
will

have
a
larger
impact
on
foreign

Iinancial
institutions
and

intermediaries
in
the
next
5
years
as

FATCA.

Let
us
help
you
assess
how
this
will

impact
your
organization
and
how
to

implement
a
practical,
affordable

solution.

In
today’s
global
landscape

international
tax
structuring
and

planning
has
never
been
more

important.

From
transfer
pricing,
treaty

compliance,
withholding

minimization,

estate
planning
and

domiciliation,

to
pre-‐residency
tax

planning
Gray
is
ready
to
help
you

navigate
this
difIicult
terrain.

U.S.
FCPA
COMPLIANCE

Widespread
globalization
brings

increased
risks
of
corrupt
practices,

and
correspondingly,
an
increase
in

FCPA
enforcement,
penalties
and

prosecutions.

Let
Gray
help
you
prepare
and

implement
appropriate
controls
to

protect
your
organization
from

violations.

International

Accounting &

Compliance

WHERE WE WORK
GEOGRAPHIC AREAS OF EXPERIENCE

Greenland

Alaska

Iceland

Canada

USA

Bahamas

Mexico

Belize

Guatemala

El
Salvador

Cuba

Honduras

Nikaragua

Dom.
Rep.

Jamaica

Venezuela

Costa
Rica

Guyana

Panama
Columbia

Suriname

Fr.
Guyana

Ecuador

Brazil

Peru

Norway

Sweden

Russia

Great

Germany

Belarus

Ireland
Britain

Poland

Ukraine

Kazazhstan

France

Mongolia

Romania

Uzbekistan

Kyrgysistan

Italy

North
Korea

Spain

Portugal

Turkey

Tajikistan

Japan

Greece

Syria

Turkmenistan

China

South
Korea

Tunisia

Lebanon

Iraq

Iran
Afghanistan

Morocco

Bhutan

Israel

Nepal

Qatar

Algeria

Libya

Pakistan

Saudi

Westsahara

Taiwan

Egypt

Myanmar

Arabia
U.A.E

India

Laos

Eritrea

Oman

Mauritania

Bangladesh

Mali
Niger

Vietnam

Chad

Senegal

Yemen

Sudan

Cambodia

Burkina

Guinea

Philippines

Nigeria

Thailand

Ethiopia

Sierra
Leone

C.A.R.

Kamerun

Somalia

Malaysia

Liberia

Togo

Uganda

Ghana

Cote
d‘Ivoire

Gabun

D.
R.

Kenya

Congo

Indonesia

Tanzania

R.
Congo

Angola

Bolivia

Paraguay

Finland

Namibia

Zambia

Papua
New
Guinea

Mozambique

Zimbabwe

Botswana

Madagascar

Australia

Swaziland

South
Africa

Chile

Uruguay

Argenena

Lesotho

New
Zealand

International

Accounting &

Compliance

SWITZERLAND
Gray
has
extensive
experience
working
in
Switzerland.
The
Firm
has
represented
both
Swiss

companies
and
individuals,
as
well
as
U.S.
taxpayers
who
have
sough
relief
under
the
U.S.
Offshore

Voluntary
Disclosure
Program
(OVDP).
The
Firm
launched
its
(Swiss
Bank)
Independent
Examiner

services
in
response
to
the
release
of
the
Program
For
Non-‐Prosecution
Agreements
or
Non-‐Target

Letters
for
Swiss
Banks,
by
and
between
the
U.S.
Department
of
Justice
and
Swiss
Federal

Department
of
Finance,
on
August
29,
2013.

The
Firm
has
a
depth
of
relationships
in
Switzerland,
and
has
extensive
experience
operating
under

both
Swiss
law
and
in
compliance
with
U.S.
laws
and
regulations
(both
tax
and
securities).
The
Firm

is
committed
to
Switzerland,
and
as
a
result
Switzerland
is
one
of
our
key
markets.

The
Firm
focuses
on
the
following
key
practice
areas
in
Switzerland:

(SWISS
BANK)
INDEPENDENT
EXAMINER

FATCA
IMPLEMENTATIONS

U.S.
TAX
OPINIONS

PFIC
REPORTING/COMPLIANCE

OFFSHORE
VOLUNTARY
DISCLOSURES

International

Accounting &

Compliance

THE U.S. DOJ / SWISS PROGRAM

AN OVERVIEW

International

Accounting &

Compliance

THE PROGRAM

The
“Program
for
Non-‐Prosecution
Agreements
or
Non-‐Target
Letters
for
Swiss
Banks”
as
announced

jointly
by
the
United
States
Department
of
Justice
(the
“DOJ”)
and
the
Swiss
Federal
Department
of

Finance
on
August
29,
2013
(
“the
Program”)
is
open
to
every
Swiss
Bank
that
is
not
currently
under

investigation
by
the
DOJ
(further
deIined
as
Category
1
Banks).
The
Program
provides
a
mechanism
for

banks
to
resolve
past
U.S.
cross-‐border
regulatory
exposure,
deIine
their
potential
exposure,
and

mitigate
penalties
(if
their
U.S.
account
holders
duly
disclose
the
existence
of
the
account(s)
under
an

Offshore
Voluntary
Disclosure
after
the
bank
has
notiIied
the
client
of
such
program).

Compliance
with
the
Program
should
result
in
the
avoidance
of
prosecution
by
the
DOJ.

The
key
features
of
the
program
are
as
follows:

• 

Category
1
Banks
(the
14
banks
that
are
already
under
investigation
by
the
DOJ)
are
not

eligible
to
participate
in
the
program.

• 

Category
2
Banks
will
pay
a
penalty
and
may
request
a
Non-‐Prosecution
Agreement

(“NPA”)
from
the
DOJ.

• 

• 

Category
3
and
4
Banks
will
be
able
to
prove
compliance
with
U.S.
laws
(i.e.
prove
their

innocence)
and
will
obtain
a
Non-‐Target
Letter
(“NTL”)
from
the
DOJ
and
will
not
pay

penalties.

Mutual
undertaking:
The
Program
is

mutual
understanding
between
the
Swiss
and
U.S.

Government,
the
Swiss
State
Secretariat
for
International
Financial
Matters
(“SIF”)
has

released
a
Circular
Letter
on
July
3,
213
which
outlines
the
terms
under
which
Swiss
Banks
are

allowed
to
co-‐operate
in
the
Program.

International

Accounting &

Compliance

CATEGORY 2 BANK

A
Category
2
Bank
is
any
Swiss
bank:

•  As
to
which
the
DOJ
has
not
authorized
a
formal
criminal

investigation
concerning
its
operations
as
of
August
29,
2013
(i.e.
that

is
not
a
Category
1
Bank);

•  that
is
not
a
Category
4
Bank;
and

•  that
has
reason
to
believe
it
may
have
committed
tax-‐related
offenses

under
Titles
18
or
26,
United
States
Code,
or
monetary
transactions

offenses
under
§
§
5314
or
5322,
Title
31,
United
States
Code,
in

connection
with
undeclared
U.S.
Related
Accounts
held
by
the
Swiss

Bank
during
the
Applicable
Period;

•  which
may
request
a
Non-‐Prosecution
Agreement
on
the
terms
set

out
in
the
Program.

International

Accounting &

Compliance

CATEGORY 3 BANK

A
Category
3
Bank
is
any
Swiss
bank:

•  As
to
which
the
DOJ
has
not
authorized
a
formal
criminal

investigation
concerning
its
operations
as
of
August
29,
2013
(i.e.
that

is
not
a
Category
1
Bank);

•  that
is
not
a
Category
4
Bank;
and

•  that
not
committed
any
tax-‐related
offenses
under
Titles
18
or
26,

United
States
Code,
or
monetary
transactions
offenses
under
§
§
5314

or
5322,
Title
31,
United
States
Code,
in
connection
with
undeclared

U.S.
Related
Accounts
held
by
the
Swiss
Bank
during
the
Applicable

Period
(i.e.
that
is
not
a
Category
2
Bank);

•  may
request
a
Non-‐Target
Letter
on
the
terms
set
out
in
the

Program.

International

Accounting &

Compliance

CATEGORY 4 BANK

A
Category
4
Bank
is
any
Swiss
bank:

•  As
to
which
the
DOJ
has
not
authorized
a
formal
criminal

investigation
concerning
its
operations
as
of
August
29,
2013
(i.e.
that

is
not
a
Category
1
Bank);

•  that
is
“Deemed
Compliant
Financial
Institution”
as
a
“Financial

Institution
with
Local
Client
Base”
under
the
FATCA
Agreement,

Annex
II
Paragraph
II.A.1,
as
if
the
FATCA
Agreement
were
in
force

during
the
Applicable
Period
(except
that
the
Swiss
Bank
must
meet

the
terms
of
Annex
II,
Paragraph
II.A.1.e
on
December
31,
2009,
and

the
date
of
the
announcement
of
this
Program);

•  may
request
a
Non-‐Target
Letter
on
the
terms
set
out
in
the

Program.

International

Accounting &

Compliance

THE
PROGRAM
–
CATEGORY
2
BANKS

International

Accounting &

Compliance

REQUESTING THE NPA

Each
Swiss
Bank
requesting
an
NPA
must
provide
a
letter
to
the
DOJ
(Tax
Division),
expressing
its
intent,
no

later
than
December
31,
2013.
The
letter
must:

•  Include
a
plan
for
complying
with
the
requirements
set
forth
in
the
Program,
within
a
reasonable
time,

but
not
to
exceed
120
days
from
the
date
of
the
letter
of
intent;

• 

provide
the
identity
and
qualiIications
of
the
Independent
Examiner;

• 

state
that
the
Swiss
Bank
will
maintain
all
records
required
for
compliance
with
the
terms
of
an
NPA

as
set
out
in
the
Program,
including
all
records
that
may
be
sought
by
treaty
requests;
and

• 

state
that
the
Swiss
Bank
agrees
that
with
respect
to
any
applicable
statue
of
limitations
that
has
not

expired
as
of
the
date
of
the
announcement
of
this
Program,
the
Bank
waives
any
potential
defense

based
on
the
statute
of
limitations
for
the
period
from
the
date
of
the
announcement
of
the
Program
to

the
issuance
of
an
NPA
or
a
DPA
(deferred
prosecution
agreement).

• 

Note:
If
the
Bank
is
not
able
to
comply
with
the
requirements
set
out
in
the
Program
within
120
days

from
the
date
of
the
letter
of
intent,
the
DOJ
will
grant
a
one-‐time
extension
of
60
days
upon
a
showing

of
good
cause.

• 

If
the
DOJ
concludes
that
a
Swiss
Bank
has
met
all
obligations
set
forth
in
the
NPA,
the
Department
will

not
prosecute
the
Swiss
Bank
for
any
tax-‐related
offenses
under
Titles
18
or
26,
United
States
Code,
or

for
any
unreported
monetary
transactions
under
§§
5314
or
5322,
Title
31,
United
States
Code,
in

connection
with
undeclared
U.S.
Related
Accounts
held
by
the
Swiss
Bank
during
the
Applicable

Period.

International

Accounting &

Compliance

SUBMISSION OF EVIDENCE AND INFORMATION
(PRIOR TO THE NPA)

Each
Swiss
Bank
requesting
an
NPA
must
fully
cooperate
in
the
disclosure
of
the
following
evidence
and

information
prior
to
the
execution
of
an
NPA
:

•  How
the
cross-‐border
business
for
U.S.
Related
Accounts
was
structured,
operated,
and
supervised

(including
internal
reporting
and
other
communications
with
and
among
management);

• 

the
name
and
function
of
the
individuals
who
structured,
operated,
or
supervised
the
cross-‐border

business
for
U.S.
Related
Accounts
during
the
Applicable
Period;

• 

how
the
Swiss
Bank
attracted
and
serviced
account
holders;

• 

an
in-‐person
presentation
and
documentation,
property
translated,
supporting
the
disclosure
of
the

above
information,
as
well
as
cooperation
and
assistance
with
further
explanation
of
information
and

materials
so
presented,
upon
request,
or
production
of
additional
explanatory
materials
as
needed;

and

• 

The
total
number
of
U.S.
Related
Accounts
and
the
maximum
dollar
value,
in
the
aggregate,
of
the
U.S.

Related
Accounts
that:

•  existed
on
August
1,
2008

•  were
opened
between
August
1,
2008,
and
February
28,
2009;
and

•  were
opened
after
February
28,
2009

International

Accounting &

Compliance

SUBMISSION OF EVIDENCE AND INFORMATION
(UPON EXECUTION OF THE NPA)

Upon
execution
of
an
NPA,
for
all
U.S.
Related
Accounts
that
were
closed
during
the
Applicable
Period,
the
Swiss

Bank
must
provide
information
including:

•  The
total
number
of
accounts;
and

• 

as
to
each
account:

•  The
maximum
value,
in
dollars,
or
each
account,
during
the
Applicable
Period;

•  the
number
of
U.S.
persons
or
entities
afIiliated
or
potentially
afIiliated
with
each
account,
and

further
noting
the
nature
of
the
relationship
to
the
account
of
each
such
U.S.
person
or
entity
or

potential
U.S.
person
or
entity;

•  whether
it
was
held
in
the
name
of
an
individual
or
an
entity;

•  whether
it
held
U.S.
securities
at
any
time
during
the
Applicable
Period;

•  the
name
and
function
of
any
relationship
manager,
client
advisor,
asset
manager,
Iinancial

advisor,
trustee,
Iiduciary,
nominee,
attorney,
accountant,
or
other
individual
or
entity

functioning
in
a
similar
capacity
known
by
the
Bank
to
be
afIiliated
with
said
account
at
any
time

during
the
Applicable
Period;
and

•  information
concerning
the
transfer
of
funds
into
and
out
of
the
account
during
the
Applicable

Period
on
a
monthly
basis
(including,
but
not
limited
to,
cash
transfers,
transfers
though

intermediaries,
and
identiIication
of
transferring
or
transferee
Iinancial
institutions)

International

Accounting &

Compliance

NPA - PENALTY STRUCTURE

Upon
execution
of
an
NPA,
the
Swiss
Bank
will
agree
to
pay
as
a
penalty:

•  For
U.S.
Related
Accounts
that
existed
on
August
1,
2007,
an
amount
equal
to
20%

of
the
maximum
aggregate
dollar
value
of
all
such
accounts
during
the
Applicable

Period;

•  for
U.S.
Related
Accounts
that
were
opened
between
August
1,
2008,
and
February

28,
2009,
an
amount
equal
to
30%
of
the
maximum
aggregate
dollar
value
of
all

such
accounts;
and

•  for
U.S.
Related
Accounts
that
were
opened
after
February
28,
2009,
an
amount

equal
to
50%
of
the
maximum
aggregate
value
of
all
such
accounts.

•  Penalty
Mitigation
Provision:
The
determination
of
the
maximum
dollar
value
of

the
aggregated
U.S.
Related
Accounts
may
be
reduced
by
the
dollar
value
of
each

account
as
to
which
the
Swiss
bank
demonstrates,
to
the
satisfaction
of
the
DOJ,

was
not
an
undeclared
account,
was
disclosed
by
the
Swiss
Bank
to
the
U.S.
IRS,
or

was
disclosed
to
the
U.S.
IRS
through
an
announced
Offshore
Voluntary
Disclosure

Program
or
Initiative
following
notiIication
by
the
Swiss
Bank
of
such
a
program
or

initiative
and
prior
to
the
execution
of
the
NPA.

International

Accounting &

Compliance

CLOSURE OF ACCOUNTS AND POST NPA COMPLIANCE

Closure
of
Accounts:

The
terms
of
an
NPA
will
provide
that
the
Swiss
Bank
agrees
to
close
any
and
all
accounts
of
recalcitrant

account
holders,
as
deIined
in
Section
1471(d)(6)
of
the
U.S.
Internal
Revenue
Code
(i.e.
all
undeclared

accounts).
The
Terms
of
the
NPA
will
require
that
the
Swiss
Bank
implement
procedures
to
prevent
its

employees
from
assisting
recalcitrant
account
holders
to
engage
in
acts
of
further
concealment
in
connection

with
closing
any
account
or
transferring
any
funds.

Will
not
open
undeclared
accounts:

The
terms
of
the
NPA
will
also
provide
that
the
Swiss
Bank
agrees
not
to
open
any
U.S.
Related
Accounts
except

on
conditions
that
ensure
that
the
account
will
be
declared
to
the
U.S.
and
will
be
subject
to
disclosure
by
the

Swiss
bank.

Testimony
and
Treaty
Requests:

In
addition
the
Swiss
Bank,
upon
request,
will
provide
that
for
the
testimony
of
a
competent
witness
or

information
as
needed
to
enable
the
DOJ
to
use
the
information
and
evidence
obtained
pursuant
to
the

provisions
on
the
Program
or
separate
treaty
request
in
any
criminal
or
other
proceeding;
and
will
assist
in
the

identiIication
and
translation
of
signiIicant
documents
at
the
expense
of
the
Swiss
Bank.

Records:

In
furtherance
of
these
provisions,
the
Swiss
Bank
will
maintain
all
records
related
to
its
U.S.
cross-‐border

business
for
a
period
of
10
years
from
the
termination
date
of
the
NPA.

International

Accounting &

Compliance

INDEPENDENT EXAMINER’S REPORT (NPA)

Prior
to
the
execution
of
the
NPA,
the
Swiss
Bank
will,
at
its
expense,
have
the

information
as
submitted
to
the
DOJ,
veriIied
by
an
Independent
Examiner.

The
veriIication
will
include
a
statement
that
the
Independent
Examiner
has

conIirmed
that
the
due
diligence
standards
set
forth
in
the
Program,
were

applied
in
collecting
the
information.

The
Independent
Examiner’s
report
must
be
sent
to
the
DOJ
(Tax
Division)
for

review.

International

Accounting &

Compliance

FALSE OR MISLEADING INFORMATION

If
the
DOJ
determines
(in
its
sole
discretion)
that
any
information
or
evidence

provided
by
the
Swiss
Bank
is
materially
false,
incomplete,
or
misleading,
it
may

decline
to
enter
into
an
NPA.

If
after
entering
the
NPA,
the
DOJ
determines
that
the
Swiss
Bank
has
provided

materially
false,
incomplete
or
misleading
information
or
evidence,
or
has

otherwise
materially
violated
the
terms
of
the
NPA,
the
U.S.
may
pursue
any
and

all
legal
remedies
available
to
it,
including
investigating
and
instituting
criminal

charges
against
the
Swiss
Bank,
without
regard
to
any
other
provision
of
the

NPA
or
the
Program.

International

Accounting &

Compliance

THE
PROGRAM
–
CATEGORY
3
BANKS

International

Accounting &

Compliance

REQUESTING THE NTL
(CATEGORY 3 BANKS)

Each
Swiss
Bank
requesting
an
NTL
must
provide
a
letter
to
the
DOJ
(Tax
Division),

expressing
its
intent,
no
earlier
than
July
1,
2014
and
no
later
than
October
31,
2014.
The

letter
must:

•  Include
a
plan
for
complying
with
the
requirements
set
forth
in
the
Program,

within
a
reasonable
time,
but
not
to
exceed
120
days
from
the
date
of
the
letter
of

intent;

•  provide
the
identity
and
qualiIications
of
the
Independent
Examiner;

•  state
that
the
Swiss
Bank
will
maintain
all
records
required
for
compliance
with

the
Program;

•  state
that
the
Swiss
Bank
agrees
that
with
respect
to
any
applicable
statue
of

limitations
that
has
not
expired
as
of
the
date
of
the
announcement
of
this

Program,
the
Bank
waives
any
potential
defense
based
on
the
statute
of
limitations

for
the
period
from
the
date
of
the
announcement
of
the
Program
to
the
issuance
of

a
Non-‐Target
Letter.

International

Accounting &

Compliance

INTERNAL INVESTIGATION
(CATEGORY 3 BANKS)

A
Swiss
Bank
requesting
a
NTL
must
at
its
own
expense,
engage
and
Independent

Examiner
to
conduct
an
independent
internal
investigation.

At
the
conclusion
of
the
internal
investigation
the,
Swiss
Bank
and
the
Independent

Examiner
must:

•  Verify
the
percent
of
the
Swiss
Bank’s
account
holdings
and
asset
under

management
that
are
U.S.
Related
Accounts;

•  verify
that
the
Swiss
Bank
has
an
effective

compliance
program,
accompanied
by
a

description
of
the
compliance
program;
and

•  provide
the
DOJ
with
a
report
of
the
Independent
Examiner’s
internal

investigation,
prepared
in
English,
that
includes:
(i)
a
list
of
the
witnesses,

including
titles,
interviewed
by
the
Independent
Examiner
and
a
summary
of
the

information
provided
by
each
witness;
(ii)
identiIication
of
the
Iiles
reviewed
by

the
Independent
Examiner;
(iii)
the
factual
Iindings
of
the
Independent
Examiner;

and
(iv)
the
conclusions
reached
by
the
Independent
Examiner.

International

Accounting &

Compliance

CLOSURE OF ACCOUNTS AND POST NTL COMPLIANCE

Closure
of
Accounts:

The
Swiss
Bank
requesting
the
NTL
must
agree
to
close
any
and
all
accounts
of
recalcitrant
account
holders,
as

deIined
in
Section
1471(d)(6)
of
the
U.S.
Internal
Revenue
Code
(i.e.
all
undeclared
accounts)
and
shall

implement
procedures
to
prevent
its
employees
from
assisting
recalcitrant
account
holders
to
engage
in
acts
of

further
concealment
in
connection
with
closing
any
account
or
transferring
any
funds.

Will
not
open
undeclared
accounts:

The
Swiss
Bank
shall
also
agree
not
to
open
any
U.S.
Related
Accounts
except
on
conditions
that
ensure
that
the

account
will
be
declared
to
the
U.S.
and
will
be
subject
to
disclosure
by
the
Swiss
bank.

Records:

The
Swiss
bank
shall
maintain
all
notes,
drafts,
correspondence,
reports,
and
other
documents
or
records

created
or
prepared
in
any
manner
by
the
Independent
Examiner,
or
reviewed
by
or
provided
to
the

Independent
Examiner,
for
a
period
of
ten
years
from
the
date
of
the
Non-‐Target
Letter.

False
or
Misleading
Information:

If
the
DOJ
determines
(in
its
sole
discretion)
that
any
information
or
evidence
provided
by
the
Swiss
Bank
is

materially
false,
incomplete,
or
misleading,
or
Iinds
that
it
has
otherwise
materially
violated
the
terms
of
any

agreement
with
the
U.S.,
the
U.S.
may
pursue
any
and
all
legal
remedies
available
to
it,
including
investigating

and
instituting
criminal
charges
against
the
Swiss
Bank,
without
regard
to
any
other
provision
of
the
NTL
or
the

Program.

International

Accounting &

Compliance

CHANGE FROM CATEGORY 3 TO CATEGORY 2

If
a
Swiss
Bank,
after
having
undertaken
an
investigation
in
a
timely
and
good
faith

manner,
belatedly
determines,
based
on
the
discovery
of
information
that
in
good
faith

could
not
have
been
discovered
previously,
that
it
should
instead
have
requested
an
NPA

as
a
Category
2
Bank,
the
DOJ
may
consider
whether
to
enter
into
discussions
with
the

Swiss
Bank
as
if
the
Swiss
Bank
had
timely
requested
an
NPA
under
the
terms
of
the

Program.

A
request
for
relief
under
this
provision
must
be
made
before
October
31,
2014.

Relief
will

be
granted
at
the
sole
discretion
of
the
DOJ,
and
only
under
extraordinary
circumstances.

Under
no
circumstances
will
such
relief
be
considered
if
the
DOJ
has
authorized
a
formal

criminal
investigation
concerning
the
operations
of
the
Swiss
bank,
or
has
received

information
concerning
wrongful
conduct
by
the
Swiss
Bank.

International

Accounting &

Compliance

THE
PROGRAM
–
CATEGORY
4
BANKS

International

Accounting &

Compliance

REQUESTING THE NTL
(CATEGORY 4 BANKS)

Each
Swiss
Bank
requesting
an
NTL
as
a
Category
4
Bank
must
provide
a
letter
to
the
DOJ

(Tax
Division),
expressing
its
intent,
no
earlier
than
July
1,
2014
and
no
later
than
October

31,
2014.
The
letter
must:

•  Include
a
plan
for
complying
with
the
requirements
set
forth
in
the
Program,

within
a
reasonable
time,
but
not
to
exceed
120
days
from
the
date
of
the
letter
of

intent;

•  provide
the
identity
and
qualiIications
of
the
Independent
Examiner;

•  state
that
the
Swiss
Bank
will
maintain
all
records
required
for
compliance
with

the
the
Program;

•  state
that
the
Swiss
Bank
agrees
that
with
respect
to
any
applicable
statue
of

limitations
that
has
not
expired
as
of
the
date
of
the
announcement
of
this

Program,
the
Bank
waives
any
potential
defense
based
on
the
statute
of
limitations

for
the
period
from
the
date
of
the
announcement
of
the
Program
to
the
issuance
of

a
Non-‐Target
Letter.

International

Accounting &

Compliance

INTERNAL INVESTIGATION AND EVIDENCE
(CATEGORY 4 BANKS)

To
obtain
a
NTL
as
a
Category
4
Bank,
a
Swiss
bank
must:

•  Provide
veriIication
executed
by
the
Swiss
Bank
and
an
Independent
Examiner
that:

i. 
It
is
not
currently
the
target
of
an
authorized
formal
criminal
investigation

concerning
its
operations
by
the
DOJ,
that
it
is
a
“Deemed
Compliant
Financial

Institution”
as
a
“Financial
Institution
with
Local
Client
Base”
under
the
FATCA

Agreement;

ii. 
agree
to
maintain
records
sufIicient
to
establish
the
basis
for
veriIication
of
its

status
as
a
Category
4
Bank
for
a
period
of
ten
years
from
the
date
of
the
Non-‐
Target
Letter;
and

iii. 
agrees
that,
if
the
DOJ
determines
(in
its
sole
discretion),
determines
that
any

information
or
evidence
provided
by
the
Swiss
Bank
is
materially
false,

incomplete,
or
misleading,
or
Iinds
that
it
has
otherwise
materially
violated
the

terms
of
any
agreement
with
the
U.S.,
the
U.S.
may
pursue
any
and
all
legal

remedies
available
to
it,
including
investigating
and
instituting
criminal
charges

against
the
Swiss
Bank,
without
regard
to
any
other
provision
of
the
NTL
or
the

Program.

International

Accounting &

Compliance

OTHER PROVISIONS
(ALL BANKS)

•  The
DOJ
will
not
authorize
formal
criminal
investigation
of
any
additional

Swiss
banks
in
connection
with
undeclared
U.S.
Related
Accounts
held
by

the
Swiss
bank
during
the
Applicable
Period
before
January
1,
2014.

•  The
personal
data
provided
by
the
Swiss
banks
under
this
Program
will

be
used
and
disclosed
only
for
purposes
of
law
enforcement
(which
may

include
regulatory
action)
in
the
U.S.
or
as
otherwise
permitted
by
U.S.

law.

•  The
Program
is
conditioned
on
the
intention
of
Switzerland,
as
stated
in

the
Joint
Statement
between
the
U.S.
Department
of
Justice
and
the
Swiss

Federal
Department
of
Finance
dated
August
29,
2013,
to
encourage

Swiss
Banks
to
consider
participation
in
the
Program.
Should
Switzerland

fail
to
provide
or
act
to
withdraw
such
encouragement,
or
should
legal

barriers
prevent
effective
participation
by
the
Swiss
Banks
on
the
terms

set
out
in
the
Program,
the
Program
may
be
terminated.

International

Accounting &

Compliance

(SWISS BANK) INDEPENDENT EXAMINER

OUR SERVICES

International

Accounting &

Compliance

INDEPENDENT EXAMINER SERVICES
Gray
International
(via:
Gray
CPA,
PC
–
a
U.S.
CertiIied
Public
Accountant)
is
uniquely
positioned
to

provide
full
scale
Independent
Examiner
Services
in
Switzerland
and
can
handle
the
“short
notice”

demands
of
the
Program
for
all
levels
of
Swiss
Banks.

Gray
is
authorized
to
practice
in
front
of
the
U.S.
Internal
Revenue
Service,
and
is
PCAOB
registered

which
means
that
it
is
authorized
to
act
as
an
auditor
for
companies
registered
with
the
U.S.

Securities
and
Exchange
Commission.
Gray
is
a
member
of
the
American
Institute
of
CertiIied
Public

Accountants
and
the
Center
for
Audit
Quality
(U.S.).

Gray
has
a
breadth
of
experience
in
international
auditing,
compliance,
U.S.
Taxation,

U.S.
Offshore

Voluntary
Disclosures,
and
operating
in
the
Swiss
environment.

FULL
SCALE
INDEPENDENT
EXAMINER

U.S.
CPA(s)

U.S.
TAX
ATTORNEYS

U.S.
SEC
AUDITORS

EXTENSIVE
SWISS
EXPERIENCE

International

Accounting &

Compliance

LEAD EXAMINER

Mr.
Stobie
is
the
CEO
of
Gray
International,
Ltd
(and
Gray
CPA,
PC),
with
over
10
years
experience
practicing
as
a

certiIied
public
accountant
and
subject
matter
expert
(consulting
and
testifying).
Mr.
Stobie
specializes
in

international
taxation,
accounting
and
auditing,
anti-‐money
laundering
and
corruption.
Mr.
Stobie
has
represented

clients
from
Mexico,
China,
Malaysia,
Hong
Kong,
Taiwan,
Singapore,
Iran,
Ghana,
the
Ivory
Coast,
Pakistan,
the

United
Arab
Emirates,
Columbia,
Canada,
Ukraine,
Switzerland,
France,
Luxembourg
and
many
other
countries.

Mr.
Stobie
has
over
13
years
experience
in
Iinance,
securities
and
private
equity
and
also
serves
as
the
Chief

Executive
OfIicer
and
Chief
Compliance
OfIicer
of
Capital
Privé
Suisse
S.A.
(registered
with
the
U.S.
SEC
and
a

member
in
good
standing
with
the
Association
Romande
de
Intermédiaries
Financiers)
a
Geneva
based
fund
sponsor

and
private
wealth
manager.
Mr.
Stobie
has
served
as
Chief
Financial
ofIicer,
Chief
Executive
OfIicer
and
Managing

Partner
for
a
myriad
of
domestic
and
international
businesses
over
the
last
decade.
Mr.
Stobie
has
extensive

experience
operating
and
investing
in
both
developing
and
developed
markets.

Mr.
Stobie
has
experience
in
M&A
Advisory,
SEC
Practice
and
Reporting,
Securities
Compliance,
Venture
Capital,

Mezzanine
Financing,
Forensic
Accounting
and
United
States
Tax.

Mr.
Stobie
is
a
CertiIied
Public
Accountant
(State
of
Texas
and
State
of
Washington),
CertiIied
Fraud
Examiner,

Chartered
Global
Management
Accountant,
and
CertiIied
in
Financial
Forensics
by
the
American
Institute
of
Public

Accountants.
Mr.
Stobie
is
a
member
of
the
Washington
Society
of
CertiIied
Public
Accountants
and
the
American

Institute
of
CertiIied
Public
Accountants.

International

Accounting &

Compliance

ENGAGEMENT
Gray
is
offering
its
services
as
an
independent
examiner
on
a
limited
basis
and
only
after

careful
consideration
of
the
prospective
examinee
(Swiss
Bank),
their
internal
control

structure,
their
data
systems
and
condition
of
records,
and
qualiIications
of
their
supporting

professionals.

Due
to
the
short
term
nature
of
the
Program:
Gray
will
only
consider
a
limited
number
of

engagements.
Client
acceptance
of
Category
2
Banks
will
be
conducted
in
November
and

December
of
2013,
and
for
Category
3
and
4
Banks
in
February
through
September
of
2014.

SigniIicant
preparations
must
be
made
in
order
to
ensure
a
successful
engagement,
and
as
a

result,
considerable
preparations
must
take
place
before
the
Iiling
of
the
letter
or
intent.

Contact
Gray
to
schedule
an
appointment
to
discuss
engagement
alternatives
as
soon
as

possible.

International

Accounting &

Compliance

CONTACT US
Gray
welcomes
your
questions,
comments
and
inquiries
and
would
like

the
opportunity
to
serve
you.

Address:
U.S.
International
OfIice

(Handling
U.S.
Tax
and
Compliance
for
International
Business)

Attn:
Jeremy
Stobie,
CPA,
CFE

th
Street
10900
NE
8

Suite
1000

Bellevue,
WA
98004

Phone:
+
001
425.999.3685
xt
10

Website:
www.grayintl.com

E-mail:
info@grayintl.com

International

Accounting &

Compliance

Swiss Bank Independent Examiner

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