European Confiscation

QUESTION: Martin, I read with alarm the blog post this morning about the coming 10% tax to be imposed on European accounts.  I’m an American with an IRA managed by a SEC regulated private Swiss Banking firm with my funds in an Austrian branch of a Swiss Bank.  I report the account on my tax returns every year.  Not trying to hide anything here.  Just want to avoid loss of funds for no good reason.  Is it time to bring it back to the states?

ANSWER: When they took the funds in Cyprus, the EU did not distinguish between European, American, or Russian accounts. I cannot honestly answer that question for it would be just a guess on my part and I do not guess with people’s lives. We all have an opinion, but that is not fact. So my only way of judging the risk is based upon their past performance. It is better to be safer than surprised. Perhaps if they had a subsidiary or branch outside of Europe, that might help moving the account to there. But the Swiss are vulnerable to threats from Germany and France. They have not shown the backbone they should have taken, but then again, they could have been cutoff from trade with the EU, which was a threat. They would then lose all their other industries. The Swiss chose to sacrifice the banking industry and they did a good job wiping that out.