On November 3, 2014, we posted Ex-UBS Executive And Ex-Mizrahi Banker Found Not Guilty In Tax Evasion Trials! where we discussed that jurors in federal court in Fort Lauderdale, Florida, found former UBS AG executive Raoul Weil not guilty of conspiracy to defraud the United States for his alleged role in helping nearly 20,000 U.S. clients hide $20 billion in assets from the Internal Revenue Service.
The decision came as a significant blow to federal prosecutors, who had focused their efforts on convicting Weil, formerly the third-ranked officer at the Swiss banking giant as the head of its wealth management and business banking division and the most senior individual they targeted.
This came on the heels of Friday’s (October 31, 2014) acquittal of a retired senior vice president at Israeli-based Mizrahi Tefahot Bank Ltd. in Los Angeles federal court on charges he helped U.S. customers conceal their assets from the Internal Revenue Service. Shokrollah Baravarian, 82,was charged with conspiring to defraud the U.S. and helping Mizrahi clients prepare false tax returns. Prosecutors claimed Baravarian helped clients who opened accounts in Israel, didn’t declare them to the IRS and accessed money through loans from the Los Angeles branch. These acquittals represent a substantial setback to the seven-year U.S. campaign to curtail offshore tax evasion.
We then posed the question of whether these 2 recent losses in foreign banker/promoter cases may have a chilling effect on the DoJ’s desire to obtain prison terms for bankers/promoters currently under investigation and could possibly cause the DoJ to also rethink prison terms for U.S. Taxpayers with undisclosed offshore accounts.
Now we know the answer to this question, which is that these 2 losses have not caused the DoJ to change it desire to obtain prison terms for bankers/promoters.
According to Forbes, another high level Swiss banker has been charged with conspiring to evade U.S. taxes. The latest indictment is of Martin Dunki, formerly Senior VP at Swiss private bank Rahn & Bodmer. He lives in Switzerland and has not been arrested, but has been charged with one count of conspiracy to defraud the IRS. It carries a maximum sentence of five years in prison.
This is in conformity with Robert Panoff’s quote in our November 12, 2014 post The Weil Not Guilty Verdict – Road Map For Future Criminal Defense Strategies? “The acquittal of Raoul Weil is the loss of one battle in what has been an enduring, lengthy and highly successful war on U.S. tax evasion involving the use of foreign bank accounts and those who aid and abet their conduct.”
“Those who think that this result will cause the Justice Department and the IRS to retreat in their ongoing efforts Should Rethink Their Position.”
Today, almost no offshore account or trust is safe. Already many countries are implementing broad disclosure policies, even Russia and China. For Americans who fail to step forward, the IRS and Department of Justice warn of their vast resources. The IRS and Justice Department may not be scorching the earth, but they aren’t far off.
Offshore accounts and the income and penalties associated with them have accounted for billions of dollars flowing to the IRS over the last 5 years. And it isn’t over yet.
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Original Post By: Ronald Marini