(Updated to include UBS comments on the settlement and to clarify the process by which U.S. tax authorities will acquire UBS account information.)

WASHINGTON (

TheStreet

) -- The concept of the secret Swiss bank account may have come to an end.

On Wednesday, the giant Swiss vault-keeper

UBS

(UBS) - Get Report

agreed effectively to hand over to the Internal Revenue Service and the Justice Department the bank-account information of thousands of clients whom the U.S. has accused of tax evasion.

The settlement culminates a process that began in June 2008, when the U.S. first brought its so-called John Doe summons to UBS in a bid to root out wealthy tax dodgers who have allegedly stashed their cash away from the prying eyes of U.S. revenuers. IRS commissioner Doug Shulman has indicated that those accounts contained, at one time, some $18 billion in assets.

Earlier reports suggest that the feds requested information on as many as 52,000 accounts. Under the settlement terms announced Wednesday, the U.S. will have access to 4,450 accounts, but officials have said the number will undoubtedly grow.

For the time being, however, the settlement entails only those 4,450 accounts. Under the terms of the deal and the existing tax treaty between the two nations, UBS will submit the information surrounding these customers to the Swiss government, which will comb through the data and pass along to U.S. authorities only those accounts it has deemed worthy of further scrutiny.

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According to a Justice Department press release, U.S. officials will have a look at the accounts that come its way and then press forward with individual investigations. The feds are already pursuing some 150 criminal cases against Americans with UBS deposits, while the IRS has "successfully prosecuted" four U.S. clients of UBS using information surrendered by the bank.

If U.S. authorities do not receive what they deem to be an appropriate number of names by Aug. 24, 2010, the government retains the right to resume legal action.

Swiss banking officials would, of course, deny that the institution of the secret account has crumbled, arguing that the tax treaty between the U.S. and Switzerland has existed for years and that nothing has effectively changed.

"This agreement helps resolve one of UBS's most pressing issues," UBS Chairman Kaspar Villiger said in a prepared statement. "I am confident that the agreement will allow the bank to continue moving forward to rebuild its reputation through solid performance and client service."

UBS has encouraged all of its U.S.-based banking customers under scrutiny to self-disclose their accounts to the IRS under the agency's voluntary disclosure program. Anyone who does so by the program's deadline of Sept. 23 will presumably receive some leniency on the part of the IRS.

Wednesday's pact does not end with UBS. A precedent has evidently been set. The Swiss government also agreed to push other banks to hand over customer information, should the U.S. deem it necessary in future investigations.

UBS shares closed Wednesday's regular session at $15.44, down 46 cents, or nearly 3%, on heavier-than-average volume. Crosstown rival

Credit Suisse

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saw its American Depositary Receipts lose 11 cents to $49.36.

-- Reported by Scott Eden in New York

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