UBS Will Release Names Of Americans Hiding Money From IRS
Swiss bank UBS, which has "admitted conspiring to defraud the Internal Revenue Service and agreed to pay $780 million to settle a sweeping federal investigation into its activities," has agreed to release the names of Americans who have been secreting away cash in UBS' fabled Swiss bank accounts. The U.S. Justice Department has been investigating about 19,000 accounts, but the New York Times says the bank may only release a couple hundred names. Update: Now the IRS has asked a judge to demand that UBS turn over the names of around 52,000 clients. UBS says it will "vigorously challenge" the new request.
UBS has admitted that it worked in cahoots—in cahoots!—with its American customers to defraud the U.S. government, going so far as to encourage them to hide valuables in Swiss safe deposit boxes and use Swiss credit cards to evade the IRS. It seems they finally agreed to turn over the names to avoid indictment, which would have been disastrous for the bank.
It's unclear what will happen next when the names are released, but Marketwatch reported that the IRS plans to go after the American citizens who have used UBS accounts to avoid paying taxes:
"These taxpayers should note that today's agreement states that the U.S. Government will continue to seek enforcement of the summons," IRS Commissioner Doug Shulman said in a statement.
"People who have hidden unreported income off shore need to get right with their government," he added.
"A Swiss Bank Is Set to Open Its Secret Files" [New York Times]
"UBS to pay $780 million in tax conspiracy case" [Marketwatch]
"UBS pressed for 52,000 names in 2nd inquiry" [International Herald Tribune]
(Photo: Allie_Caulfield)
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Comments:
Well put, I wonder if the Swiss will start a chain reaction in other places like the Cayman islands.
Please let me be on the list.
Please let me be on the list.
*crosses fingers*
@undefined: And this is why I think tax law is awful from a human rights perspective.
What do you call the entity that claims sole right and domain over the fruits of your labors?
My father has a UBS account, but he also used to work for another Swiss bank and says not as much shady stuff goes on as you'd imagine. He said the ones they should really look into are the banks in small island nations that rich people and big companies use to store money, as well as the Principality of Liechtenstein. It has more registered companies than citizens and many big businesses use it to do all sorts of illegal things.
This UBS stuff is the tip of the corrupt iceburg.
@InThrees: Well, there are actually two entities, but I'm trying to be discreet about the name of the other one.
@Eldritch:
The difference between the Swiss banks (like UBS) and those island banks is Switzerland is a country with a legitimate government & legal infrastructure, instead of a country using their sovereignty almost solely to protect a banking racket.
The tip is all we can pursue via a criminal justice route.
They should tell the government to shove off. Oh well.
Everyone can thank Mr. Phil Graham of " America is a bunch of winers" fame and "Mr. Old Guy John McCain's failed Presidential campaign."
They are responsible for most of what is going on in the banking industry. I am hope that the new administration has really rigid rules going forward. If they do not put some regulations in play we will probably fall like Rome....Hail Caesar!!
This ought to be interesting as the IRS uncovers why they were diverting money and who was doing it. Between all the investment scams and UBS rolling over what disgusting revelation will be next?
I don't like paying taxes anymore than the next guy so it would be nice to see some taxe cheats get spanked.
What'll happen is: The IRS will get the names, they will find that more than half of them are prominent politicians or other public figures, and we will never hear about this again.
Happened with the "DC Madam".
*cough* *cough* dual citizenship
The IRS is quite aware of all of the island republics where the rich are stashing their goods and possibly laundering their money. The difference here is that UBS does loads of business in the US. UBS has offices everywhere in North America, and depends on US citizens for a large portion of its operation. The gov't can shut down their dealings here very easily and possibly deal them a fatal blow as they've been crippled by the whole financial mess. UBS has no recourse here, they pretty much have to relent.
But as for other operations that are more entrenched in foreign nations (especially the island "nation banks," the gov't can do very little about those.
Good thing those bank executives got those bonuses from the bailout money because they're gonna need it now....
I wonder what made them decide which few hundred names to release...? (I'm trying to suggest they took bribes or something. Considering what they did already... help people defraud the gov't and suggest using Swiss cards...)
@Russell Miller: I think some names will get released and Limbaugh, Hannity, Olberman, etc. will use selective names to create the media narrative that all D's or R's are corrupt, elites, etc.
@ARP:
Elites? You think? How much money do you need before you start considering a swiss bank account? 1M? 10M? 100M?
@dako81: Yeah, I'd love to see that.
Then I'd love to see the government revoke their charter, seize their assets, and put their upper management in jail.
You seem to have things reversed, so let me clarify for you. Corporations exist at the behest of governments. Not the other way around.
"Slave master." Damn, you libertarians have no sense of humor.
These scoundrels are cheating me and you and everyone else, causing the rest of us to pay more for the government services we've chosen democratically.
I don't have time to be deputized and take down these arrogant bastards with extreme prejudice, so I'm happy to let the government take care of it.
The government is the enforcer working for me, not the wronged party. It's a criminal prosecution, not a lawsuit.
If the IRS really wanted to get tax cheats, they should just go for the shady tax preparation offices in the US. I worked a tax preparation office in a lower class part of Los Angeles back in 2005-6 and you wouldn't believe what goes on there. During tax season they would do about 1,500+ tax returns and about 99% of them were filled with lies. The most common practices were to under report 1099s, deduct non-existing expenses and the #1 cheat was finding "dependants" to claim the EIC. They would do this by obtaining ITINs for "family" in other countries. No question asked and wham, $4,000 tax return just like that. You might think it's only 1,500 tax returns per year, but these places are in every corner and they all do the same. Multiply 1,500 by thousands and I'm sure there are billions of dollars being stolen. You might think that sooner or later they would get audited, but in the time I was there we only heard of 2 people being audited.
@RandomHookup: Indeed. However, there's a significant difference. The American people have not been harmed by baseball player's steroid use (unless they were betting against the users, I guess), whereas the people all had to pick up the slack from these account holders.
@Alexander: If you're not joking, why not report these tactics to the IRS yourself? Surely there are whistle-blower laws that would protect you.
What has the USA become? The rich dodge taxes, Madames in D.C. host famous politicians and are quickly covered up, Madoff Makes off with billions and walks the streets, corporations screw over the working citizens and get BAILED OUT, auto companies fail at producing quality products and get bailed out, only to request MORE money (While threatening the loss of jobs) as the average Joe foresaw, and now another monumental bill of spending has passed.
When does the average person finally have enough? When will we all stand up and fight the government for screwing us all over? For taxing and enslaving our future children? For throwing the country into ruin while the working families suffer from the decisions of the rich? For keeping those responsible in offices who brought the most powerful country to its knees?
What new nightmare involving banks, fraud, tax evasion, politicians, and the scum of America make the news next?
Note to self: Don't hide money in foreign banks that have US branches.
The interesting part in the whole drama is that UBS had to get permission from the Swiss government to turn over the names because of Swiss banking privacy laws. Up until that happened, UBS faced the unenviable position of facing prosecution and contempt charges in the US for refusing to turn over the names or facing prosecution in Switzerland for violating their customers' privacy.
@acklenheights: Track who the U.S. customers of the island nation banks are, and freeze all their assets here in the U.S. until they agree to turn over their offshore assets.
Forfeit their sheltered money then revoke their citizenship. Let's see how they like being proud citizens of Antigua, with a middle-class net worth.
@GildaKorn: And (cough) a reward, I believe.
I'll take my vig for this tip in the form of a donation to skool Teh Kids.
@Trai_Dep: And/or seize every one of their assets in the U.S. That would pretty much destroy the business of most corporations.
There are legitimate reasons to put your assets in countries with private banking laws. For instance, if I decide I want to drop everything and disappear, it's my right to do so.
If I am of the means to walk away from my job, my friends, family, and never be found, whose business is it other than my own?
Should I have decided to do the above, my every transaction, location, etc can be tracked.
@jmndos: Dual citizenship won't save you. The U.S. requires its citizens to report *all* income to the IRS, no matter where it is made or where you live at the time. I'm sure that there are people here who can speak on this better than I can. As I understand it, the US is one of the few countries in the world that require this of their citizens.
@johnva: Why should they have to "turn over their offshore assets"? It's not illegal for a US citizen to hold an offshore account - it just has to be reported to the IRS.
@Russell Miller: That's why UBS won't be release ALL the names. From the article:
...but UBS ultimately may disclose the identities of only a few hundred customers
Yeah, I guess there's only a few hundred that are NOT politicians or well connected individuals.
That's why I bury my millions in the back yard.
@GildaKorn: Because these are the people that the government wants to get the wealth that they've taken from the working class.
@Alexander: The IRS doesn't have the resources to go after thousands of people per year, so they have to choose their battles. Which is better, going after 1000 people that got an extra $4000($4000 * 1000 = $4,000,000), but aren't likely to be able to pay it back anyway, or going after 100 people that each owes $1,000,000($100,000,000) in taxes and can likely afford to pay it? All politics aside, it makes sense to go after the people that can afford to pay.
If a lot of people are using something like you describe to cheat on their taxes, then the IRS will usually change the rules to try to prevent the fraud. In this case, they may require some kind of documentation that the dependent actually exists. There have been several loopholes like this closed over the years for similar reasons.
@Patrick Henry: Democrats & Republicans = Populists
The "average person" will never "have enough" up as long as they are spoon-fed a piece of the pie. Gov't in the US operates on the notion that you toss the folks a fish and watch 'em put their fins together.
The Wall Street version of the latest MLB steroid scandal.