Wegelin & Co.
| Company type | Kommanditgesellschaft |
|---|---|
| Industry | Private banking, asset management |
| Founded | 1741 |
| Founder | Caspar Zyli |
| Defunct | 2013 |
| Fate | Ceased operations following legal issues; majority of operations transferred to Notenstein Privatbank |
| Headquarters | St. Gallen , Switzerland |
Area served | International clientele |
Key people | Otto Bruderer, Konrad Hummler, Steffen Tolle, Michele Moor, Christian Raubach, Christian Hafner |
| Products | Private banking, investment management |
Number of employees | 700 (2011); approx. 250 (2025) |
Wegelin & Co. was a Swiss private banking institution headquartered in St. Gallen, Switzerland, with a focus on private banking and asset management. Established in 1741 by Caspar Zyli, the bank adopted the name Wegelin & Co. in 1893. Over time, its formal designation evolved to include the names of its senior personally liable partners; by 2013, it was officially titled Wegelin & Co. Privatbankiers, Gesellschafter Bruderer, Hummler, Tolle & Co. At the time it ceased operations, it held the distinction of being Switzerland's oldest bank and ranked as the 13th oldest globally.
The bank catered to an international clientele and employed around 700 people in 2011, with this number decreasing to approximately 250 by 2025. Operating as a Kommanditgesellschaft, Wegelin & Co. was acquired by Swiss Crown AG, with underwriting support from UBS Bank. Its primary services encompassed private banking and investment management.
The institution's activities were terminated following legal complications tied to facilitating tax evasion by US clients, which severely damaged its reputation and business continuity.
History
Originating as a partnership established by linen merchant Caspar Zyli (1717–1758), the enterprise was initially named Leinentuchhandel und Speditionshandlung ("Linen trade and freight forwarder"). From inception, banking services were part of its offerings. In 1798, Zyli's son purchased the Nothveststein property. By 1860, Emil Wegelin-Wild, Zyli's nephew, joined as a partner and steered the firm toward specializing in asset management. The company transitioned into a Kommanditgesellschaft in 1893 and adopted the Wegelin & Co. name inspired by Emil Wegelin-Wild.
During the 1990s, a management buyout led by managing partner Konrad Hummler resulted in eight partners owning 80% of the business, while the Wegelin family retained a 20% stake. This ownership structure largely remained intact until the bank’s dissolution.
By 2003, ownership had consolidated among five private individuals, and as of January 2012, the bank continued to be privately held. The workforce expanded from 30 employees in 1990 to roughly 700 by 2011. The bank established branches in Zürich (1998), Lugano (2000), Bern (2002), Basel, Geneva, and Locarno (2007), followed by Chur (2009), Lucerne (2010), and Winterthur (2011). As of 2013, personally liable partners included Otto Bruderer, Konrad Hummler, Steffen Tolle, Michele Moor, Christian Raubach, and Christian Hafner.
Organization
All Wegelin & Co. locations were situated within Switzerland, with its main office based in St. Gallen. Prior to restructuring in 2012, the bank employed approximately 700 staff members distributed across Basel, Bern, Chiasso, Chur, Geneva, Lausanne, Locarno, Lugano, Lucerne, Schaffhausen, Winterthur, and Zurich. A significant portion of personnel were recruited from the nearby University of St. Gallen, highlighting strong institutional connections. As of January 2012, client assets under management exceeded CHF 24 billion, including an estimated CHF 3 billion in pension funds and private client portfolios.
In 2008, Wegelin was described as a "boutique personal wealth management" firm—small in scale yet concentrated on serving a niche market segment.
Court case
Between 2002 and 2010, Wegelin & Co. assisted American clients in concealing assets totaling more than $1.2 billion to evade US taxes. In early 2012, the bank transferred its non-US operations—including clients, assets, and most employees—to its subsidiary Notenstein Privatbank, which was subsequently acquired by the Raiffeisen banking group.
In January 2013, the reduced Wegelin entity pleaded guilty in a New York court to conspiracy charges for helping over one hundred US clients hide $1.2 billion from the Internal Revenue Service over ten years. While these actions complied with Swiss law, Wegelin agreed to pay $57.8 million in penalties—approximately five percent of the concealed sum—to US authorities. Concurrently with this plea agreement, Wegelin announced it would cease operations. Notenstein Privatbank continues to operate from Wegelin’s former headquarters with its workforce of around 700 employees. Managing partner Otto Bruderer admitted during court proceedings that "Wegelin was aware that this conduct was wrong."
US courts found Wegelin guilty of money laundering and facilitating tax evasion; its correspondent account at UBS AG in Connecticut incurred a $16 million fine. The bank maintained that it operated exclusively within Switzerland and was subject solely to Swiss jurisdiction. The $57.8 million settlement comprised $20 million restitution payments, $15.8 million asset forfeiture, and $22.05 million in additional fines.
During legal proceedings, representatives for Wegelin asserted their procedures aligned with Swiss banking standards but conceded that their American clients violated US laws.
Wegelin became the first foreign bank to admit guilt on US tax evasion charges and declared permanent closure following its plea.
Despite substantial penalties imposed on Wegelin & Co., it remains uncertain whether authorities required disclosure of American clients holding undisclosed Swiss accounts.
Anthony Michael Sabino from St. John's University's Peter J. Tobin College of Business observed that although Wegelin's case serves as a cautionary example for smaller banks, it simultaneously sends an unsettling signal to major financial institutions that paying fines may allow them to avoid meaningful repercussions while continuing their usual operations.
Restructuring
In January 2012, the majority of Wegelin's workforce, clientele, and assets amounting to 21 billion Swiss francs were moved to Notenstein Privatbank, a subsidiary founded in 1968 but operating as a distinct legal entity. This transition took place shortly before Wegelin faced charges on 3 February 2012. Notenstein Privatbank, maintaining operations from the same headquarters and retaining Wegelin's previous staff of approximately 700 employees, ensured continuity of business activities with minimal interruption.
As a result of this reorganization, by February 2012, Wegelin & Co. was reduced to a staff of only 15 individuals.