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UBS : Former UBS banker fined in Switzerland for handing data to U.S.

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10/13/2014 | 03:31pm EDT

BERNE (Reuters) - A former banker at Switzerland's biggest bank, UBS, has been found guilty of handing over protected Swiss bank account data to the United States, according to a penalty order issued by the Swiss prosecutors' office.

According to the order the banker was found to have breached Swiss data privacy laws but not its banking secrecy laws which the U.S. authorities have long tried to penetrate in their pursuit of suspected tax evaders.

A lawyer for Renzo Gadola declined to comment on the matter.

Gadola, who worked at UBS from 1995 to 2009, pleaded guilty in the United States in 2010 to conspiring to defraud the Internal Revenue Service and in 2011 was sentenced to five years' probation and fined $100.

But Gadola started cooperating with U.S. officials almost immediately after his arrest in 2010, providing insight into other bankers and Swiss financial institutions offering offshore banking services, according to prosecutors at the time of his sentencing in 2011.

As a result Switzerland's prosecutor said in November last year it was investigating Gadola. According to the penalty order dated July 21, 2014 and seen by Reuters, Gadola was subsequently found guilty under protected data laws of handing over two sets of bank account information to the U.S. authorities.

Gadola was fined 6,000 Swiss francs ($6,288), suspended pending two years probation, and ordered to cover the legal fees of the trial, which are put at 7,117 francs for breaching the Swiss law of economic espionage, according to the penalty order.

But he escaped harsher penalties as prosecutors failed to prove a second charge of violating the Swiss banking secrecy laws, an offense which is punishable by up to three years in prison and a fine of up to 250,000 francs.

Gadola was spared under the banking secrecy laws because he was not employed by the bank from which the clients' data stemmed, according to the penalty order.

The penalty was first reported on Sunday by Swiss newspaper Schweiz am Sonntag.

In the document prosecutors said Gadola's crime did "not weigh heavily," since he handed over only two sets of data. The U.S. obtained other information from Gadola through forceful means -- by confiscating his laptop, his smartphone, and work documents in 2010, according to the penalty order.

Prosecutors also cited several extenuating factors in Gadola's favor, including the fact that he must make himself available to the U.S. authorities before every trip to the United States, where two of his three children live.

A Department of Justice document from 2011 states that Gadola must return to the United States at least once a year to assist the DOJ in its continuing investigations of cross-border banking.

Meanwhile a U.S. trial against another former UBS banker, Raoul Weil, is set to begin in a Fort Lauderdale, Florida court on Tuesday.

If convicted at trial Weil faces up to five years in prison for conspiracy to commit tax fraud. A source familiar with the matter said Gadola is expected to be a witness in that trial.

(Additional reporting by Alice Baghdjian and Oliver Hirt in Zurich and Karen Freifeld in New York; Writing by Joshua Franklin; Editing by Greg Mahlich)

By Ruben Sprich

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