Bloomberg News reports:
More than 150 UBS AG clients in the U.S. are under investigation for concealing income and assets offshore at the bank, a prosecutor said in a court filing.
The scope of the investigation was disclosed today in a memo recommending that former UBS banker Bradley Birkenfeld serve 30 months in prison for conspiring to help wealthy Americans evade taxes. Birkenfeld, who faces as long as five years, will be sentenced Aug. 21 in Fort Lauderdale, Florida.
Birkenfeld, 44, pleaded guilty in June 2008 to conspiracy, saying he helped U.S. clients evade taxes through Zurich-based UBS. He seeks leniency for helping a worldwide tax-fraud probe. UBS agreed Feb. 18 to pay $780 million to avoid prosecution for helping wealthy Americans evade taxes. The bank gave account data on 250 clients to the U.S. Internal Revenue Service.
Three UBS clients pleaded guilty since the agreement to filing false tax returns, and a fourth was charged last week with failing to file a tax report for an offshore account.
On Feb. 19, the IRS sued UBS in federal court in Miami, seeking the names of Americans suspected of evading taxes through 52,000 secret Swiss accounts. On Aug. 12, a Justice Department lawyer told the judge in the case that the two sides had reached a settlement.
Birkenfeld has been under house arrest with electronic monitoring near Boston. His lawyer, David Meier, didn’t immediately return a call seeking comment.
Birkenfeld has given information to the IRS, U.S. prosecutors, the U.S. Securities and Exchange Commission, U.S. Senate investigators and foreign countries “investigating, among other things, UBS’s conduct in those countries,” according to the memo.
Birkenfeld was a banker for California billionaire Igor Olenicoff, who pleaded guilty in December 2007 to filing a false tax return that failed to declare accounts at UBS, where he once had $200 million in assets. Olenicoff got two years’ probation and paid $52 million in back taxes, interest and penalties.
Birkenfeld said when he pleaded guilty that UBS earned $200 million a year by managing $20 billion in assets and setting up sham entities for clients in tax havens like Panama and the British Virgin Islands.
A neurosurgeon’s son who worked in Switzerland for three international banks, Birkenfeld told prosecutors and U.S. Senate investigators how UBS courted clients like Olenicoff.
In pleading guilty, Birkenfeld said as many as 60 UBS private bankers trolled for clients at UBS-sponsored art shows, yachting regattas and golf and tennis tournaments. He said he toted customer checks to deposit in European banks and bought diamonds for one client, smuggling them to the U.S. in a toothpaste tube.
Birkenfeld cooperated with the government in the summer of 2007, according to the memo.
Birkenfeld was arrested on May 7, 2008, after flying into Boston to attend his high school reunion.
(Source: Bloomberg.com)
Join the official YWN WhatsApp status
5 Responses
The amount involved is unbelievable. It is more than the amount actually involved in the Madoff affair (the initial figures were overstated, surprisingly, it seems Mr. Madoff tends to lie a lot).
Well well the world is coming to an end. at least ubs can file for chapter 11.
#2 – ??? – The Swiss bank have to choose between doing business in the United States, or maintaining
bank secrecy. They can’t expect to assist in defrauding the American tax payers of tens of billions of dollars, while operating in the United States. If they limit their operations to Switzerland, they can have all the secret accounts
they want.
I see only Jewish names. In addition, this has been a long standing problem with the Swiss bank accounts. So, are they only targeting Jews in their IRS probe?
I read in last week’s Yated Ne’eman that there is extreme anti-semitism in some quarters of the FBI and the State Department. Could it now have spread to the IRS too?
#4 – Germans, including the Swiss, have names very similar to Asheknazim. Indeed, unless the name is derived from Hebrew (such as Cohen, Levi, etc.), all Ashkenazim have German names (okay, technically “Yiddish” names, though no one really thought that Yiddish was other than a dialect of German until the 20th century).