An American who hid money from the Internal Revenue Service in an offshore bank account was recently sentenced to three years probation. The San Diego man also had to pay nearly $100,000 to settle his tax accounts with the IRS. He had failed to file Foreign Bank and Financial Reports, or FBARs.
In the tax years for 2000 through 2008, the man filed false tax returns that did not report his interest in or signature authority over offshore bank accounts in Switzerland and the Bahamas that he held through Swiss banking giants UBS and Credit Suisse. Interest earned on the offshore accounts was not reported either.
The man's undoing was an agreement reached between the U.S. government and UBS in 2009. UBS admitted that it counseled American taxpayers on how to hide assets from the IRS, and provided the accounts to do it. To avoid prosecution by the U.S. government, UBS agreed to reveal the identities and account information of many American offshore bank account holders. The man sentenced to probation was one of the account holders whose identity came out in the UBS deal.
Orange County tax attorneys have been aware that the U.S. government and many governments of the European Union have continued to take action to recover tax income from undeclared assets in Swiss banks and other offshore accounts. The IRS and the Justice Department have used information gained from taxpayers who came forward during a partial amnesty over undeclared offshore accounts. The information helped the authorities understand how assets were being hidden, find out which banks were helping Americans hide assets, and discover the identities of additional people with undeclared assets in offshore accounts.
Source: Wall Street Journal "US Client Of Swiss Bank Gets Probation For Hiding Assets Abroad" 3/14/2011