IRS UBS/Wegelin Summons
U.S. Taxpayers with unreported foreign bank accounts/income from those accounts face civil and criminal prosecution from accounts held at Swiss Banks: UBS/Wegelin Bank. Under a recently issued IRS summons (approved by U.S. Federal Court), the IRS has summoned wire transfer information from UBS Correspondent Bank Accounts (in Connecticut) to disclose the identity of those U.S. taxpayers who sent funds offshore to Swiss Banks (UBS), Wegelin Bank and at least two other unnamed Swiss Banks.
U.S. Taxpayers who sent funds via wire transfer to unreported, undisclosed Swiss Bank Accounts and evaded U.S. income taxes (on either the original monies earned which were the source of the wire transfer, or the earnings in the undisclosed foreign, offshore accounts), with the participation of U.S. (or offshore) tax advisors, face four separate felonies: tax evasion, conspiracy to commit tax evasion, money laundering, mail fraud and wire fraud.
The scenario includes:
1) Tax Evasion: The U.S. Taxpayer willfully fails to: pay a tax due, file a tax return due, or fraudulently files a false tax return. (Penalty: 5 years in jail.)
2) Conspiracy to Commit Tax Evasion: Under a “Klein Conspiracy” (18 USC 371), it is a crime for two or more persons to conspire to commit an offense against the U.S., which includes an agreement by two or more persons to impede the IRS. (Penalty: 5 years in jail.)
3) Money Laundering: The disguise of the nature of the origin of funds. The predicate offenses (known as Specified Unlawful Activities, i.e. “SUA”) under the Money Laundering Control Act (18 USC Sec. 1956 and 1957) includes: tax evasion.
4) Mail Fraud/Wire Fraud: If a tax advisor sends instructions to a client via telephone, e-mail, U.S. Mail, and a client transfers funds (pursuant to counsel’s instructions) by wire transfer, the client may be liable for mail fraud and wire fraud.
On March 19, 2013 the Los Angeles Times reported that Alfred J.R. Villalobos, former CalPERS Board Member and Deputy Los Angeles Mayor, and Federico Boen-Rostro, Jr., former CEO of CalPERS, were indicted for ”kickbacks”; i.e. they were paid large amounts of money to secure $3b in CalPERS business (investments), for Apollo Global Management (New York based private equity firm) and committed fraud by creating and sending phony documents to “comply” with the requirement from Apollo that CalPERS officials knew they were being paid by Apollo.
The federal indictment charged conspiracy to: defraud the U.S., conspiracy to commit mail fraud and wire fraud. The maximum penalty for mail and wire fraud is 20 years in prison and a fine of $250,000, or twice the amount of loss, whichever is greater. These penalties may also apply to offshore tax evasion, for taxpayer off-shore wire transfer of funds.