Zurich - The largest Swiss Bank, UBS, would comply with the terms of a deal reached with the US Justice Department, a spokesman confirmed Thursday, in order to avoid prosecution and settle claims of conspiring to help thousands of wealthy US citizens evade taxes.

The bank would pay 780 million dollars in fines and would transfer information on accounts of clients who most likely committed fraud, said spokesman Serge Steiner.

"UBS will fully comply" with the agreement, he added.

"Client confidentiality, to which UBS remains committed, was never designed to protect fraudulent acts," Peter Kurer, the bank's chairman, said in a statement released close to midnight Wednesday.

Switzerland's banking sector has longstanding principles of secrecy.

The Geneva-based Le Temps newspaper reported that the bank would reveal some 250 names, a number UBS would not confirm.

All the information to be handed over would be of clients who "appear to have committed tax fraud or the like within the meaning of the Swiss-US Double Taxation Treaty," UBS said.

The handing over of names was in agreement with FINMA, the Swiss regulatory body.

A US warrant was issued last year for 19,000 names.

"It is apparent that as an organization we made mistakes and that our control systems were inadequate," said Marcel Rohner, the banks's CEO.

The Swiss Federal Banking Commission (SFBC) meanwhile concluded that UBS violated the requirements for proper business conduct and limited its right to provide services to US residents not regulated by the Securities and Exchange Commission.

The commission ordered UBS to enhance its control framework on its cross-border operations.

UBS said that it would charge the settlement to the performance year 2008.

The US government said that it would not pursue criminal charges, as part of a "deferred prosecution" agreement, on the condition that the bank makes promised reforms, provides clients' names, pays the hefty fine and halts the practise of providing banking services to US clients with undeclared accounts.

"UBS executives knew that UBS' cross-border business violated the law," said Alexander Acosta, US attorney for the southern district of Florida. "They refused to stop this activity, however, and in fact instructed their bankers to grow the business."

"The reason was money - the business was too profitable to give up. This was not a mere compliance oversight, but rather a knowing crime motivated by greed and disrespect of the law."

Swiss lawyers, including Andreas Rud, who represents UBS clients in the US, expressed outrage at the settlement, which he said would erode the credibility of the Swiss bank system.

The settlement comes a week after both UBS and Credit Suisse, the second-largest Swiss bank, reported huge fourth- quarter losses.

UBS's 2008 losses amounted to more than 19.6 billion francs. It has announced job cuts and taken a bailout from the Swiss government.

The bank is expected to be able to retain its US banking licenses as part of the deal and keep its top executive out of courts, Swiss media said. (dpa)