UBS and a family-controlled company in Liechtenstein used the country's opaque banking rules to help well-heeled Americans hide almost $18 billion from tax authorities, according to a damning report published by a US Senate sub-committee today.

The 114-page report argues that the Swiss bank, the world's biggest money manager, and LGT Group, owned by Leichenstein's ruling family, colluded in the region's "culture of secrecy and deception" to help 19,000 of its US customers pay less tax.

The report, by the Senate Permanent Subcommittee on Investigations, claims that UBS and LGT used several methods to help clients, including moving their money into the country via a web of accounts in order to make detection less easy.

Bank staff were told to telephone clients from public payphones so tracing calls would be difficult, the report alleges.

The report represents the latest expose on Liechtenstein, a long-standing tax haven for the wealthy. About a dozen countries are investigating alleged tax scams in the country many involving LGT.

It is also the latest effort by American authorities to crack down on what they see as unfair tax avoidance by some of its citizens. Today's report estimates that the US Treasury loses $100 billion a year through offshore tax evasion.

"UBS has opened thousands of accounts in Switzerland that are beneficially owned by US clients, hold billions of dollars in assets, and have not been reported to US tax authorities," the report claims.

"UBS allowed these clients to continue to maintain accounts in Switzerland, and helped them to reinvest in other types of assets that did not trigger reporting obligations to the IRS [Internal Revenue Service], despite evidence that the US clients were using the accounts to hide assets from the IRS," it says.

Last month, a former UBS banker, Bradley Birkenfeld, pleaded guilty to conspiring to help Igor Olenicoff, a Californian billionaire evade taxes.

He said he conspiring with Mario Staggl, a Liechtenstein banker, to hide about $200 million on behalf of customers.

Mr Birkenfield helped the US authorities compile the report. Mr Staggl is a fugitive.

The sub-committee, which begins hearings into the status of tax havens later day, does not accuse either UBS or LGT of breaking the law.

Karina Byrne, a UBS spokesperson, declined to comment to Bloomberg on the report.

She said: "As we're going to describe in more detail in our testimony, UBS intends to address and correct in a responsible manner any misconduct identified in the course of the ongoing investigation by US authorities."

LGT said it had always been in compliance with "pertinent laws and regulations" and had terminated arrangements that are "seen as inappropriate from today's point of view".

It said it was determined to resolve any legacy issues over the way it operated as soon as possible.

Times Recommends

• Lies and cover-up at MG Rover exposed by report
• High oil prices push manufacturing costs up
• Primark founder steps down as chief executive