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* Lower house votes against debate
* Government warns of pending U.S. indictments
* Bern scrambles to limit potential damage if bill rejected
* More than a dozen banks under investigation
* Bill referred back to upper house for debate, vote
By Katharina Bart
ZURICH, June 18 (Reuters) - Switzerland's lower house ofparliament has stalled a government bid to protect the country'sbanks from criminal charges in the United States for helpingwealthy Americans to evade tax.
The lawmakers refused to address a bill aimed at allowingbanks to sidestep strict Swiss secrecy laws by disclosing theirU.S. dealings with prosecutors, helping them to strike dealsexpected to include fines that could cost the industry as muchas $10 billion.
Banks will not be allowed to hand over client names, but theproposal would give them a one-year window to hand overinformation including names of third parties such as accountantsand tax lawyers, which should be sufficient for U.S. officialsto identify tax dodgers.
The lower house voted by a large majority not to discuss thelegislation, referring it back to the upper house. The movemeans the draft law is increasingly unlikely to be fast-trackedbefore the end of parliament's summer session on Friday.
A committee of lawmakers from the upper house, set toaddress the bill again on Wednesday, issued a statementacknowledging the situation's urgency and saying they were infavour of Swiss banks making amends for wrong-doing.
Swiss economy minister Johann Schneider-Ammann told Swissradio SRF: "Everybody, from left to right, from the governmentto parliament, is making efforts and we will find a solution." He said it was important to convey this message to the UnitedStates.
The protection of client information has helped to makeSwitzerland the world's biggest offshore financial centre, with$2 trillion in assets. But that haven has come under fire asother countries have sought to plug budget deficits by clampingdown on tax evasion, with authorities probing Swiss banks inGermany and France as well as the United States.
Swiss parliament's lower house may be given a second chanceto debate the law before the weekend, but a second refusal toaddress the bill this week would kill it and raise the prospectof the United States indicting banks.
Finance Minister Eveline Widmer-Schlumpf told lawmakers ofher fears for Swiss banks, which contribute about 6 percent ofthe Alpine nation's gross domestic product.
"There is a very real danger of an escalation," she said."Criminal charges are planned. Do you really want to prevent ourfinancial centre and our economy from returning to the stabilityit so urgently needs?"
MULTIPLE INVESTIGATIONS
U.S. authorities have more than a dozen banks under formalinvestigation, including Credit Suisse, Julius Baer, the Swiss arm of Britain's HSBC, privatelyheld Pictet in Geneva and local government-backed ZuercherKantonalbank and Basler Kantonalbank.
Many Swiss lawmakers bristled at pressure from the UnitedStates to pass the legislation quickly, with Christoph Blocher,a former minister from the right-wing Swiss People's Party,accusing the bill's supporters of fearmongering.
"They don't have arguments for it, they are simply scared," Blocher told parliament.
An indictment, seen as the death knell for virtually anybusiness, felled Wegelin & Co this year. The bank paid a $58million fine and closed its doors for good after pleading guiltyto helping wealthy Americans evade taxes through secretaccounts.
If parliament kills the bill, the Swiss government couldstill take matters into its own hands and approve the datatransfer with an executive order, though circumventing a hostileparliament is seen as a gamble.
Switzerland's biggest bank, UBS, was forced in2009 to pay a fine of $780 million and deliver the names of morethan 4,000 clients to avoid indictment, giving the U.S.authorities information that allowed them to pursue other banks.
