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Bank Participates in DOJ Program

Offshore Account Update

Posted on July 24, 2015 |

The Chief of the IRS Criminal Investigations Division was recently quoted as saying: “Fighting offshore tax evasion continues to be a top priority for IRS-CI and we will trace unreported funds anywhere in the world.” The quote was in response to a March 2015 agreement reached between the United States Department of Justice and one of the 10 largest private banks in Switzerland. The agreement was reached through the Swiss Bank Program started by the DOJ and announced on August 29, 2013.

The bank, BSI SA, was the first bank to participate in the Swiss Bank Program. There were more than 3,000 active United States related accounts held at the bank, many of which were not disclosed to U.S. taxing authorities. As part of the Swiss Bank Program, BSI SA has agreed to turn over information on these accounts and cooperate with civil and criminal prosecutions.

BSI SA is not the only bank that will be participating in the Swiss Bank Program and it is not the only bank to resolve criminal charges by giving the authorities information on taxpayers with undeclared offshore accounts.

If you have an undeclared offshore account, your bank may very well give your information to the authorities, if it has not already done so. Once you are under investigation, you can’t participate in voluntary amnesty programs to avoid criminal prosecution any more. If you have undeclared offshore accounts, do not wait -- contact a New Jersey tax attorney to get help finding out how best to explore your options for minimizing financial loss and avoiding criminal conviction.

Bank Becomes the First to Participate in Swiss Bank Program

The Swiss Bank Program was created by the Department of Justice to encourage financial institutions to come forward and resolve criminal violations in the United States. Banks are eligible to participate if they have violated U.S. tax laws by helping to facilitate tax evasion and by noncompliance with reporting requirements for offshore accounts.

Swiss banks have a long tradition of secrecy and many people throughout the U.S. use these accounts to hide funds. The DOJ’s crackdown on banks that help investors hide money has led to more and more banks being charged with crimes. The Swiss Bank Program lets banks avoid prosecution if they come forward before they are under investigation.

Banks that participate in the Swiss Bank Program can resolve their criminal charges by paying a fine and complying with a number of other requirements, including turning over information about account-holders on an account-by-account basis.

Banks must also make a complete disclosure of all cross-border activities, agree to close accounts of U.S. investors who don’t cooperate with IRS rules and provide detailed information about other banks that accepted the transfer of funds into secret accounts or that moved money into secret accounts. The information obtained from the banks that enter into these resolutions is then used to prosecute other financial institutions and accountholders.

BSI SA had violated criminal laws by helping U.S. accountholders create sham corporations and trusts, by providing numbered accounts to U.S. accountholders, and by helping U.S. citizens to repatriate their hidden funds. The resolution the bank has reached now means it will not face prosecution. Instead, the bank must simply comply with its obligations under the Swiss Bank Program. The bank will also pay a $211 million penalty.

Those whose information BSI SA provides may, however, find themselves facing prosecution. Before the IRS comes after you for tax law violations, talk to a tax attorney in New Jersey about what options you have for protecting yourself. Contact Kevin Thorn today.

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