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Thursday, January 31, 2013

WSJ: U.S. Ramps Up Offshore Tax Evasion Prosecutions, Nails 79 Year Old Widow

Wall Street Journal:  U.S. Is Preparing More Tax-Evasion Cases, by Laura Saunders:

The U.S. is expanding its crackdown of offshore tax evasion, preparing numerous criminal cases against suspected offenders, defense lawyers involved in the cases say. 

Four years after an agreement between the U.S. and Switzerland pierced a veil of banking secrecy by requiring Swiss bank UBS to turn over names of account holders, defense lawyers estimate that federal prosecutors are conducting at least 100 criminal investigations against suspected tax evaders.

The moves come as the U.S. is turning the screws on smaller banks that may have helped taxpayers stash money in secret overseas accounts. ...

The U.S. government already has won about 50 criminal cases and collected at least $5.5 billion in connection with undeclared offshore accounts. On Jan. 8, Mary Estelle Curran, a 79-year-old widow best known for volunteer work, pleaded guilty to criminal charges of filing false tax returns and evading about $668,000 in federal tax on $40 million her husband left her in a secret Swiss bank account at UBS. She agreed to pay almost $22 million, which is believed to be the largest penalty in a criminal case on offshore accounts since the UBS agreement.

Ms. Curran is scheduled to be sentenced in West Palm Beach, Fla., federal court March 26. She faces up to six years in prison.

U.S. officials "want to send a message that no one is too old, or too rich, or too poor, or too sympathetic to escape criminal prosecution," said Bryan Skarlatos, a lawyer with Kostelanetz & Fink in New York, whose firm has defended more than 30 taxpayers in criminal investigations involving offshore accounts.

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Comments

How many UBS bankers are going to prison?

(likely answer = 0)

Posted by: save_the_rustbelt | Jan 31, 2013 3:59:07 PM

A good point. Of course, this old lady hasn't been sentenced yet either, and she may get zero years in prison. She's pled guilty and agreed to pay the $22 million, so it looks like it will turn out exactly the same as with UBS: the tax cheat pays a lot of money and doesn't spend any time in jail. I don't know whether that is a good outcome or not.

Posted by: Eric Rasmusen | Jan 31, 2013 5:06:40 PM

When are they going to start going after Canadians. I have heard Canadians are getting special treatment by US DOJ despite the fact they are saying no one is getting special treatment.

Posted by: Tim | Jan 31, 2013 7:00:09 PM

Tim, why would the DOJ "start going after Canadians"? How are Canadians subject to FBAR and US tax? Please explain yourself. Canadians shouldn't be getting "special treatment". They should be getting "no treatment".

Posted by: John Smith | Feb 5, 2013 9:41:30 AM