UPDATE 1-UBS turns over 70 client names to U.S. govt -paper

(Adds UBS comment, details on Swiss law, background)

By Lisa Jucca

ZURICH, Nov 10 (Reuters) - UBS AG, the world's largest bank to the rich, has passed on information about 70 clients to U.S. authorities investigating tax evasion, a move that may undermine Switzerland's prized bank secrecy, the Washington Post reported.

UBS (UBSN.VX: Quote, Profile, Research) was responding to a Justice Department request for information on Americans who held "undeclared" accounts at the bank in Switzerland, the U.S. paper said on its website, citing an unnamed source close to the case.

A UBS spokesman said the Swiss bank had not passed on information about Swiss-based clients to the United States.

"UBS has not provided any Swiss-based client data to the U.S. authorities," the spokesman said, but would not comment on whether Swiss tax authorities had passed on such data to their U.S. counterparts.

He added that UBS was "continuing to work diligently with both Swiss and U.S. government authorities, consistent with Swiss law -- including bank-client confidentiality -- and the legal frameworks for intergovernmental cooperation and assistance established between Switzerland and the U.S."

The U.S. tax investigation risks compounding damage to UBS's reputation at a time it has been forced to make bigger writedowns than any other European bank in the credit crisis.

The U.S. Department of Justice is investigating UBS over offshore services provided to U.S. clients from 2000 to 2007 to find out whether UBS helped wealthy Americans dodge taxes.