Swiss bank accounts are world-renowned for their security, but it’s a different kind of security than what you’d see in a heist movie. The protection that applies here has nothing to do with maximum-security vaults and armed guards giving body checks; it’s about the unique privacy provided by Swiss banking law.

Most of the perks of having a Swiss bank account come from the fact that, under Swiss law, no banker can reveal anything about your account (including its existence) to anyone else without your permission. Any banker who violates this agreement is prosecuted by the state and can face fines and jail time. So once you put money in a Swiss bank account, the only people who know that money even exists are you and your banker.

Why is this anonymity so desirable? Some people just want privacy and believe that their financial situation is their own business. Others, however, try to hide their financial information from the government to avoid higher taxes. This is called tax evasion and it’s illegal. When the government tries to figure out how much money to tax you, it first needs to know how much you have. Generally, the more you have, the more taxes you pay. When the government can’t see the money you have in a Swiss bank account, they can’t include it when they calculate your taxes and you end up getting taxed for less than you’re actually worth.

Swiss banks are so popular – and so notorious – not for their physical security systems, but for the anonymity they provide to their clients. Just remember, if you live in a country like the U.S., you need to report how much money you have in a Swiss bank account to avoid getting in trouble.

Tags: anonymity, privacy, Switzerland, taxes