During a Senate hearing, Credit Suisse bank laid out a detailed defense, saying that the perpetrators were a small group of Swiss-based bankers, and that while it wanted to hand over more client names, it was caught between U.S. and Swiss law.

“Credit Suisse is ready to provide the additional information requested by the U.S. authorities on U.S. account holders, but we have been unable to do so,” the bank said in a statement provided at the hearing.

Credit Suisse had provided as much information as allowed under Swiss law, it said, and while it wanted to provide more client names, the U.S. Senate had not ratified a bilateral treaty with Switzerland that would allow it to do so.

Subcommittee Chair Carl Levin, a Michigan Democrat, poured cold water on that argument, saying the treaty will only expose U.S. accounts at Swiss banks after 2009, when it was signed.

If U.S. customers closed their accounts before 2009, they could evade detection and years of U.S. tax bills, Levin said, which Credit Suisse bankers acknowledged.

“We can’t collect taxes owed by those folks, which is what the heart of the problem is. … Don’t tell us the treaty is going to get us what we want,” he said. “It won’t.”

Levin also scolded the Justice Department for only having retrieved 238 client names from Credit Suisse – and none from the other banks under investigation. But the Justice Department officials said their work did show good progress.

Credit Suisse said it was a “demonstrably inappropriate assumption” that all 20,000 U.S. clients were tax cheats, saying many U.S. clients, such as expatriates living in Switzerland, had a valid reason to hold a Swiss bank account.   Senators accused the Department of Justice of dragging its feet.  Department of Justice Testimony
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