A Swiss flag flies on the shores of Geneva Lake on June 14, 2013 in the center of Geneva.
Photograph by Fabrice Coffrini — AFP/Getty Images
By Robert Hackett
October 22, 2015

Want to know how tax dodgers have been skirting Uncle Sam? Look no further than the alluring, financial slopes of Switzerland.

In order to avoid criminal charges, Swiss banks have been coming clean about their tax evasion tactics to the U.S. Justice Department, the Wall Street Journal reports. The trick is to grant their clients undeclared offshore accounts paired with aliases, secret passphrases, and in some cases, difficult-to-trace prepaid debit cards.

After the U.S. government began clamping down on the money-handling misconduct of big Swiss financial firms like UBS Group AG (UBS) and Credit Suisse (CS), smaller banks began adopting their rivals’ bad habits in an effort to attract customers (and profits). “The offenders range from international banks to small-town mortgage lenders, which together helped secrete more than 10,000 U.S-related accounts holding more than $10 billion,” according to the Journal’s analysis of more than 40 settlement documents.

Per the Journal:

Most firms said they provided clients with numbered or code-name accounts with identities known only to a few employees. The banks also held mail destined for the U.S., in part to calm clients who were afraid the U.S. government might go through it. One client of Bank Sparhafen Zurich AG told a manager the bank’s hold-mail fee was “cheap insurance against having my dealings with you come to the attention of the government revenue authorities.”

Other techniques involved helping clients obscure their account possessions through “sham trusts and foundations in tax havens” in foreign locals, such as Liechtenstein and the British Virgin Islands. And some banks even handed out untraceable debit cards.

When a client needed cash refill, he or she might send a secret message, like “gas tank still running on empty,” according to the Journal. Or to transfer cash: “Can you download some tunes for us?”

Those tunes aren’t free, of course. For many of these wrongdoers, it’s now time to pay the piper (aka the U.S. Internal Revenue Service).

For more on avoiding taxes, read about “Uber’s tax shell game” in the November 1, 2015 issue of Fortune magazine. Or watch the video about Swiss banking interest rates below.

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