Swiss may allow UBS to turn over more names to IRS

Switzerland may be ready to find middle ground on the issue of turning over names of UBS (UBS) banking clients to the IRS. Its seven-member cabinet plans to convene a meeting today to discuss UBS's settlement talks with the IRS, which analysts think means Switzerland is close to agreeing to U.S. demands to hand over data, even though it may bend (if not break) Swiss secrecy laws.

Negotiations heated up when U.S. Secretary of State Hillary Clinton met with Swiss foreign minister Micheline Calmy-Rey on July 31 and an August 3 court hearing was delayed. The Swiss have threatened to seize the bank records of UBS if a U.S. court orders the names of banking clients to be released. The IRS wants the names of 52,000 U.S. citizens or companies that bank with UBS. U.S. tax officials believe that UBS is hiding $20 billion of U.S. taxpayers' money in secret Swiss accounts.