Banking: privacy under threat as former senior banker says he will go public

It's difficult to understand the motivation of Wikileaks in deciding to accept details of bank accounts.

For Rudolf Elmer, the man who publicly handed them over to Julian Assange in a staged ceremony in London yesterday, the motivations are even less clear.

It was not just Assange and Elmer who shared the spotlight: a UK pressure group which supports high taxation under the perhaps misleading name of "The Tax Justice Network," sent their representative John Christensen to give his group's view on the importance of the release. Elmer has contributed to the group's blog which described him as a "whistleblower." To be fair, a contribution he published in February 2009, whilst highly unoriginal, did contain useful information for bankers (and others) on how to avoid being used as a vehicle for money laundering or tax evasion.

Assange, however, for once tried to stay at least a little out of attention. He emphasised that it was a press conference organised and held by Elmer.

Elmer claims that he has built up records on more than 2,000 people and companies including many PEPs. The data, he says, includes information about three "major financial institutions" including Bank Julius Baer where Elmer used to work. He says that he has tried to deliver the data to tax authorities but they were not interested. He also says he tried to hand it to other media who were similarly reluctant.

There is good reason: there is a very strong probability that the collecting of the data is in breach of banking confidentiality laws in both Switzerland and The Cayman Islands. So, probably, is releasing it to any third party. If Elmer was genuinely concerned as to the content of the data, then the only logical conclusion is that he would have been suspicious that the accounts were being used for money laundering. If that is so, then there is a clear and properly defined process for making such reports and to do so under that system would bring him within the safe harbour provisions of the counter-money laundering laws in both of those countries and others. Supporting that interpretation is Elmer's claim to include about 40 politicians, entertainment figures and organised crime bosses amongst the information he holds.

"WikiLeaks is my only hope to get society to know what's going on," Elmer said. That is either disturbing because FIUs won't take his data or ridiculous because an FIU will not refuse data but he, personally, is unlikely to see the results of his reports.He also claimed in an interview with CNN that he was sacked when he made internal reports about his suspicions. The bank says he was denied a promotion and then set out to intimidate the bank and wage a "personal vendetta."

Elmer is coy about the quality of the data: he says that it will not at this time be made public and that it is up to the authorities to check the veracity of the data.

And Assange is not accepting it at face value, either. "We have not seen the material. We will treat [it] like all other material we get. There will be full revelation."

That will please the American government. But it's not going to happen tomorrow. Wikileaks is wading through some 250,000 documents passed to it from someone apparently within the US State Department. The "diplomatic cables" are being carefully checked and - despite claims to the contrary - personal identifiers that would put individuals at risk are, often, being removed. Wikileaks is not performing a simple copy and publish function. But that is a huge task and so far less than 10% of the cables have appeared and, after an initial rush, interest is waning.

Assange boosted interest by saying, in November last year, that the website would be posting documents about a leading US bank - and that the revelations are so serious that they could "take down" the bank. The data, he said, would be released in early 2011. He teased his audience in an interview with Forbes, which was considering him as Man of the Year (a title eventually somewhat more safely awarded to Facebook founder Mark Zuckerberg without regard to his co-founders Chris Hughes and Dustin Moskovitz), by comparing the data to that which killed Enron.

The big question is why, if the data he holds on that and, he says, many more banks, anyone would bring it to Wikileaks. In the USA, a genuine whistle-blower with real data can claim a reward running into the millions for dobbing in a bank that's not being properly run.

Elmer already has form: it was he that released data which has resulted in him being charged in Switzerland. He says that he is releasing this latest batch as "a culprit, a witness, a whistleblower, an activist and a reformer" before heading to Switzerland to face trial.

It's a high-risk strategy, if it is true that that is where he is headed. He has, after all, already been jailed once - 30 days in Switzerland - for breaking confidentiality laws.

But there are hints that he may not be: he says he is represented by Jack Blum. Blum is a gamekeeper turned poacher, one of the US government team that investigated BCCI, Blum has leveraged that into a high-profile practice in relation to money laundering, appearing before numerous government panels punting, largely, the line the government would like to hear. It might sound like an oxymoron, but Blum often seems to be a lobbyist for the government view, a counterpoint to the lobbyists that argue for less restrictions and obligations on financial institutions.

Blum is exceptionally well connected. And that includes Senator Jack Levin. Levin was instrumental in negotiating a deal with John Matthewson of Cayman Islands based Guarian Bank. The deal was simple: hand over bank records, tell Levin how correspondent banking can be used to facilitate tax evasion and get a reduced sentence for helping others to evade US tax. Matthewson is still a wanted man in the Caymans.

Although Elmer, who has been hiding in plain site in Mauritius, says he will return to Switzerland, the link to Blum and through him the US government suggests that there may be an alternative strategy : to decamp to the USA and to try to claim political asylum. A presence in London for a few days would enable faster negotiations and a more rapid issue of a US visa.

For Assange, a second round of data that would help the US Treasury in its investigations plus give Levin even more ammunition in his crusade against the offshore industry would endear him to the Democrats. The Republicans are, mostly, seriously hostile towards him on grounds of national security - and comments that he could seriously weaken a large US bank are not going down well, either. He needs some friends in Washington and Elmer might just be a suitable tool with which to cultivate them.

Meanwhile, Bank Julius Baer says of yesterday's press conference that he did not specifically target the bank but, rather "the system."