Swiss banking giant UBS is defying a US government demand to hand over details on 52,000 suspected American tax cheats.

The Obama administration wants to track down customers who have concealed their accounts in violation of US laws. Investigators want to expand a deal which has given them access to about 250 to 300 accounts but the Swiss government is standing firm. Rudolph Merz, Swiss President and Finance Minister said: “Banking secrecy remains. It protects privacy, but it does not protect fraud.” The bank’s chairman has said UBS accepts full responsibility for helping its US clients conceal assets from the internal revenue service. Switzerland’s financial regulator Eugen Haltiner is keen to protect UBS. “We have allowed this exemption,” said Haltiner, referring to the files already released, “because this bank is vital to the Swiss financial system and the national economy.” Analysts say the decision to bypass the courts and give up customers before exhausting all legal options seriously endangers a pillar of the banking industry that helped transform Switzerland into one of the world’s richest countries.More about: Banking, Switzerland

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