Swiss citizens living in the United States are having long-held bank accounts closed down as Switzerland's largest bank, UBS, winds up cross border services.
Increasingly complex US tax regulations have also left many Americans resident in Switzerland unable to find services beyond a standard retail account with a range of Swiss banks.
Strict rules that have emerged in recent years are part of a US campaign to stop people evading taxes with offshore accounts. The issue came to a head in July when UBS cancelled cross border banking activities after being caught up in an ongoing tax evasion investigation.
UBS decided last November to stop some banking procedures between the two countries. But July's events persuaded the bank to end all but the most lucrative wealth management services.
This has resulted in Swiss nationals living in the US being given 45 days to move their accounts elsewhere. One client, resident in Washington, received a letter telling him that a 44-year-old Swiss account would be terminated.
"They are unilaterally closing down my account because I am domiciled in the US and it seems that they don't care that I am a Swiss citizen," the man, who wishes to be referred to by his initials JPS, told swissinfo.
"I try to be as pragmatic as possible and realise there may be some bad apple Swiss residents in the US that have used their Swiss offshore accounts to launder money. But there are a lot of law abiding Swiss citizens who will find it very difficult in 45 days to find another outlet."
JPS fears that some of the 74,000 Swiss citizens currently living in the US may rely on UBS accounts to deliver pension or social security payments from their homeland. His account contained inheritance money left to him by his parents that he used during trips to Switzerland.
The retired civil servant was told by the Swiss embassy in Washington that they could not intervene in his case. The embassy would not comment when contacted by swissinfo.
"A US domiciled client, even if they are a Swiss national, has to do their retail banking business with a US bank," said UBS spokesman Serge Steiner.
Swiss people living in the US are not the only ones caught in the crossfire of US tax and banking regulations. Foreign-based US citizens have complained about their country's unhelpful regime.
Andy Sundberg of the Geneva-based American Citizens Abroad group (ACA) said it has become harder for its members to open anything other than a normal deposit account at Swiss banks.
"Banks are just getting scared because they assuming heavy liabilities with a tremendous amount of reporting, that they don't fully understand, that can lead to heavy penalties," he told swissinfo.
Too much hassle
The Swiss Bankers Association told swissinfo that they had received no complaints from US citizens living in Switzerland. But spokesman James Nason acknowledged that some banks might be put off by the amount of red tape.
"Compliance costs for banks worldwide have rocketed in recent years as attempts have been made to turn them into unpaid tax collectors, policemen and spies for the state," he said.
"I can well imagine a threshold at which a bank decides for one reason or another that it's simply too much of a hassle to have clients from certain countries, including the US."
swissinfo, Matthew Allen in Zurich
US cross-border banking
Cross border banking between the US and other countries became more complex on January 1, 2001, when the US introduced the Qualified Intermediary (QI) program.
This requires banks, including those in Switzerland, to identify US resident clients, withhold tax on their US based investments and send the money to the Internal Revenue Service – the US tax collection agency – if the client fails to report their holding to the IRS.
Failure to comply with QI could see foreign banks thrown out of the American banking system. The program does not require Swiss banks to reveal details of their clients to the US authorities.
The US authorities launched an investigation into UBS after becoming suspicious that the Swiss bank was circumventing these rules by using loopholes.
UBS officials were called to a US Congressional hearing in July where they announced an end to offshore banking for US clients.
In compliance with the JTI standards