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UBS Whistleblower Now Helping France With Investigation into Tax Evasion

UBS / HSBC

Posted on June 12, 2015 |

Bradley Birkenfeld is a whistleblower. In 2007, he began providing information to the United States government about activities that were going on at UBS AG. Birkenfeld provided documents, testimony and other information to U.S. authorities demonstrating that UBS AG was using the strict banking privacy laws in Switzerland to help U.S. citizens hide funds in offshore accounts and evade their tax obligations in the United States.

Acting on information that Birkenfeld provided, the Internal Revenue Service was able to recover in excess of $5 billion in back taxes and penalties from people with undeclared offshore accounts. 

Birkenfeld has now been subpoenaed and will be testifying in France to assist with a French investigation into UBS AG. Most believe that the information he provides is going to put pressure on the bank to come to some type of settlement agreement with French authorities.

Whistleblowers are given tremendous financial incentives in the United States to help the Internal Revenue Service to recover tax money that went unpaid.  There may be more people who choose to come forward and provide information on offshore accounts.

The IRS and the Department of Justice are aggressively investigating and prosecuting banks and bankers as part of a global fight against tax evasion and investors should be very nervous if they have undeclared offshore funds.

If you have accounts the IRS does not yet know about, contact a Boston criminal tax lawyer for help understanding what you can do to try to minimize the chances that you could some day face prosecution. Your attorney can also help if you are under investigation by the IRS.

Beware: Whistleblowers Can Provide Important Information to Taxing Authorities

Aided by the information that Birkenfeld provided, the U.S. government was able to recover a huge fine from UBS AG.  The government was able to collect $780 million that the bank paid in a settlement as part of a deferred prosecution agreement. 

In addition to the UBS AG settlement, the Birkenfeld information was also instrumental in the fight against tax evasion in other ways.  Because of the details that Birkenfeld provided about how UBS was using Swiss laws to facilitate tax evasion, the Swiss government actually had to change its treaty with the United States.

Birkenfeld’s whistleblowing also led to the biggest bank in Switzerland turning over the names of 4,900 citizens of the United States who were keeping their money offshore in secretive accounts.

It remains to be seen what testimony Birkenfeld will provide in France and whether it will prove as effective in helping the French government go after banks and tax evaders.  Birkenfeld certainly was richly rewarded for his efforts in the United States, as he received a $104 million IRS whistleblower reward. 

This kind of incentive to whistleblowers means investors have a lot to worry about.  Kevin Thorn, a criminal tax lawyer in Boston, can provide advice to those who have been accused of having secret offshore accounts.  Call him as soon as possible for help if the IRS is after you now or if you fear they may be in the future.

For a consultation, contact Kevin E. Thorn, Managing Partner, at ket@thornlawgroup.com or (617) 692-2989


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