UBS to identify customers, pay $780 million (unindicted co-conspirators)

[UpInArms]

Source: Reuters

WASHINGTON, Feb 18 (Reuters) - Swiss banking giant UBS AG (UBSN.VX) (UBS.N) agreed to pay $780 million and identify certain U.S. customers in a deal to resolve criminal fraud charges that it assisted rich American clients evade taxes, the Justice Department said on Wednesday.

<snip>

Department officials said the agreement was unprecedented in pulling aside Switzerland's much-vaunted tradition of bank secrecy and described it as one of the biggest settlements ever. They said UBS admitted to helping U.S. taxpayers hide accounts from the IRS.

<snip>

In January, the former head of UBS AG's wealth management business, Raoul Weil, was formally declared a fugitive after failing to surrender to U.S. authorities on charges of conspiring to help wealthy Americans hide assets from U.S. tax authorities.

<snip>

It said about 17,000 of 20,000 U.S. cross-border clients concealed their identities and the existence of their accounts, with $20 billion in assets, from the IRS.

Some of these clients are unindicted co-conspirators.

In an unprecedented move, UBS, under orders from Swiss market regulators, agreed to immediately provide the U.S. government with the identities of, and account information for, certain United States customers, the department said.

Read more: http://www.reuters.com/article/bondsNews/idUSN1846444020090218?sp=true

---

fugitive bankers - unindicted co-conspirators?

where's Phil Gramm in all of this?

let's look back to DU elehhhhna's post from July 20, 2008

Phil Gramm's UBS Bank BUSTED in $18B Major International Tax Scandal --- Where's our MSM???

$18B in Hiding

By Alexis Glick
Hold onto your hats this is going to be UGLY. Did you hear about the federal investigation into the private banking practices at UBS? Apparently, the Senate subcommittee on investigations released a report yesterday saying that UBS’s offshore accounting practices helped American citizens hide $18 billion from the IRS. As many as 19,000 accounts according to the IRS. Roni Deutch, a tax attorney and frequent guest on Money for Breakfast told me this morning that it could be A LOT more.

It sounds like a spy novel but it’s true according to the IRS and others investigating the practice of illegally hiding funds in offshore accounts. This involves all kinds of misdeeds and heads will role not only at UBS but at other institutions who did the same thing. As Roni rightly points out, the individual taxpayers, American citizens, who hid their money with this bank will also be in hot water and will likely face jail time or fines. It’s an unbelievable story...

http://glickreport.blogs.foxbusiness.com/2008/07/18/18b... /

More details on Leichtenstein tax haven scandal
Posted: July 20, 2008, 8:59 AM by DrewHasselback
Banks
There's been a few interesting developments in the on-going Liechtenstein bank scandal.

A man identified only as "Elmar S" has become the first German citizen to be convicted of using secret bank accounts in Liechtenstein to evade taxes. Elmar S was given a two-year suspended sentence and order to give 7.5-million euros to charities and the state. The man admitted to evading 8-million euros in taxes, and was given a relatively light sentence because he cooperated with authorities.

Another big development came when U.S. Senate investigators released a 114-page document that among other things shows how Liechtenstein is used as a tax haven. The document was released prior to a hearing on Thursday at which UBS, Switzerland's largest bank, announced it would no longer help U.S. investors hide funds in secret accounts offshore.

The Liechtenstein tax scandal erupted earlier this year. Heinrich Kieber, a former employee with LGT Group, a bank owned by Liechtenstein's royal family, snuck off with computer records showing how individuals from all over the world — including some from Canada — use the sleepy alpine enclave as a place to hide money from tax agencies.

http://network.nationalpost.com/np/blogs/legalpost/archive/2008/07/20/more-details-on-leichtenstein-tax-haven-scandal.aspx

DU once again - way ahead of the curve!

[xchrom]

1. recommend -- not with a bang but a whimper

so reform begins.

[Howardx]

2. yep

lets get it front paged.

[tosh]

3. Front paged, it is.

This could turn out to be the entertainment of the century.

[MineralMan]

4. Ah...this could be the story of the decade, at least.

The list will truly blow the cover off and expose the seething stew in the pot.

I can hardly contain my anticipation at seeing such a list.

Many who are mighty will fall due to this.

[DemoTex]

10. I thought that about BCCI, too (a couple of decades ago).

I'm still waiting on that one.

[loudsue]

32. Me, too, DemoTex.

:popcorn: The first time the "wrong", well-connected high-politically-donating name pops up on the list, it will be remarkable how quiet things become.

I'm still hearing crickets about Sibel Edmonds, and she could have blown the lid off the entire underworld.

[Torn_Scorned_Ignored]

51. ...and Tom DeLay still roams free

[pleah]

5. K&R

[leftstreet]

6. K&R

[L0oniX]

7. K & R

Where's Phil Gramm in all of this ...indeed?

[DCKit]

8. Let's hope that, for a change, the penalties are higher than the profits.

Take ALL their toys away.

[FailureToCommunicate]

11. Solving the affordable housing/homeless crisis one repro mansion at a time...

[FailureToCommunicate]

9. Oh my, we pay our taxes, why don't they? Did we miss something? Are our

soldiers stationed around the world defending THOSE Americans, eh, for free? Do those tax cheats use our bridges, our science, our laws for free?!? I'm still getting my head around this one.
And are they mostly wealthy? Republican? Hypocrites?

[geckosfeet]

13. I think that we are going to be finding out pretty soon,,,,,,,,,,

[clixtox]

39. There are not any US soldiers anywhere defending Americans...

except Marines guarding our consulates and embassies.

Defend from who?

Our soldiers are stationed almost everywhere to basically intimidate the world!

BACK ON THREAD...

These tax-avoiders/non-cooperators apparently average over a million apiece in cold cash cached in Switzerland.

Busted!

Of course the messy details are, no doubt, too obtuse and obscure to share with (the) hoi polloi. There won't be any complete list of IRS scofflaws published.

Ever!

I genuinely hope that I am wrong about us discovering who got caught...

We workers are sure lucky not to have to worry about the (understandably irresistible) temptations to squirrel away any portion of our pre-tax incomes.

Luckily for us our beneficent leaders/government takes our taxes before we can see it and squander, or stash, our own money like the rich can, and surely do.

Aren't you happy about that!

No?

[Duval]

48. Or are they all of the above?n/t

[geckosfeet]

12. more,,, looks like at least one tax dodge for the rich is being dismantled,,,

John DiCicco, acting assistant attorney general of the Justice Department's Tax Division, said in a statement, "The veil of secrecy has been pulled aside and we will continue to aggressively pursue those who shirk their federal tax obligations or assist others in doing so."

... and the SEC is getting off their asses and doing something - albeit outing UBS as unregistered tax advisers instead of looking into Wall St. criminals.

The U.S. Securities and Exchange Commission said that UBS will settle U.S. regulators' claims that it acted as an unregistered broker-dealer and investment adviser.

UBS' actions helped certain U.S. clients maintain undisclosed accounts in Switzerland and other foreign countries, which in turn enabled the clients to avoid paying tax obligations, the SEC alleged.

An indictment unsealed in November alleged that Weil and other unidentified bankers conspired to help 17,000 Americans hide $20 billion of assets in Swiss bank accounts in order to avoid paying U.S. taxes.

And again, if someone had not blown the whistle this would have gone on under the SEC's nose indefinitely.

[L. Coyote]

14. Co-conspirators = 17,000 of 20,000 U.S. clients concealed their identities

[Baby Snooks]

45. And of course they're all going to be indicted...

Just amazing how some in this country truly are above the law. Of course you have to wonder how long it would take to prosecute them all.

And then you have Leona Helmsley. Convicted of tax evasion and tax fraud. And after she was convicted, the IRS finally conducted an audit. She was convicted of not paying $1.2 million in taxes. But somehow had managed to overpay her taxes for the same period by $15 million.

Something wrong with the picture. Then and now.

[KoKo]

15. Global Economy is Imploding! Time for the "Claw Backs" and this "offshore banking is OLD REGIME!

Time for this to end. Let's have ACCOUNTABILITY!

[safeinOhio]

25. I wonder about all of those communications that have been gathered

by our government. Those overseas phone, email and mail messages between the USA and off shore banking countries like the Cayman Isl.

[JerseygirlCT]

Note to Alexis Glick:

the phrase is "heads will roll", not role.

Besides that, this is very interesting. You do wonder just how far and how deep this will go.

[bertman]

35. Correctomundo, JerseygirlCT. However, it occurred to me that the "r-o-l-e" version is

a lot more likely than the "r-o-l-l" version. These types always seem to escape unscathed while a scapegoat gets barbecued.

[dmr]

38. That's my fear. I've just about given up on BCCI. n/t

[Thor_MN]

16. "certain United States customers"?

Why only certain US customers? Are certain OTHER US customer being shielded?

[Geoff R. Casavant]

44. Or other US customers haven't done anything wrong.

Presumably there are US customers who use the bank, but report the income.

[cal04]

17. UBS Agrees to Pay $200 Million to Settle SEC Charges for Violating Registration Requirements

Source: U.S. Securities and Exchange Commission

Washington, D.C., Feb. 18, 2009 — The Securities and Exchange Commission today filed an enforcement action against UBS AG, charging the firm with acting as an unregistered broker-dealer and investment adviser.

The SEC's complaint, filed in the U.S. District Court for the District of Columbia, alleges that UBS's conduct facilitated the ability of certain U.S. clients to maintain undisclosed accounts in Switzerland and other foreign countries, which enabled those clients to avoid paying taxes related to the assets in those accounts. UBS agreed to settle the SEC's charges by consenting to the issuance of a final judgment that permanently enjoins UBS and orders it to disgorge $200 million. In connection with a related criminal investigation, UBS has entered into a deferred prosecution agreement with the Department of Justice pursuant to which UBS will pay an additional $180 million in disgorgement, as well as $400 million in tax-related payments.

"The broker-dealer and investment adviser registration provisions provide important protections for investors. UBS avoided compliance with U.S. securities laws for many years, at the same time they were engaged in other illegal conduct, which makes this one of the most egregious cases of its kind," said Scott W. Friestad, Deputy Director of the SEC's Division of Enforcement.

As alleged in the SEC's complaint, from at least 1999 through 2008, UBS acted as an unregistered broker-dealer and investment adviser to thousands of U.S. persons and offshore entities with United States citizens as beneficial owners. UBS had at least 11,000 to 14,000 of such clients and held billions of dollars of assets for them. The U.S. cross-border business provided UBS with revenues of $120 million to $140 million per year.

Read more: http://www.sec.gov/news/press/2009/2009-29.htm

---

UBS to pay $780M, open secret Swiss bank records
http://www.baynews9.com/content/9/2009/2/18/439091.html?title=UBS+to+pay+$780M,+open+secret+Swiss+bank+records%0a++++

[DCKit]

18. A $200 million fine after profits of >$120 million / year - for how long?

Crime does pay and, until it doesn't, they will keep committing crimes.

[no_hypocrisy]

19. Somebody's not getting a bonus this year . . . . .

[marketcrazy1]

20. UBS Will Pay $780 Million

if you add it all up.

[David Zephyr]

21. Phil and Wendy Gramm and UBS

http://www.slate.com/id/2194933/

[cal04]

22. Swiss bank admits helping US clients avoid taxes; agrees to reveal identities

update:
http://www.marketwatch.com/news/story/UBS-pay-780-mln-helping/story.aspx?guid=%7BABE36F6C%2D8403%2D45ED%2D8320%2D23709AE28C69%7D&dist=hplatest

UBS AG agreed to pay $780 million for helping U.S. customers avoid taxes, the Department of Justice said Wednesday.

Switzerland's largest bank also agreed to turn over the identities and accounts of some of its U.S. clients to the American government, in an unprecedented move that could shine a light into the country's secretive banking industry, the DOJ added.

(snip)
"A veil of secrecy has been pulled aside," John DiCicco, acting assistant attorney general of the Justice Department's Tax Division, said in a statement. "We will continue to aggressively pursue those who shirk their federal tax obligations or assist others in doing so."

[serrano2008]

23. Whew! At least they have a "voluntary disclosure process" for the tax evaders...

...which I'm sure includes anonymity so we don't find out which Repubes were hiding money over there (Bush, Cheney, McCain, Gramm, Rummy...I'm sure the list goes on and on)


"People who have hidden unreported income offshore need to get right with their government. They should come forward and take advantage of our voluntary disclosure process," Shulman said.

[Hotler]

24. I want NAMES! How many? EVERYBODY!!!!

Ring-ring-ring, hello, Mr. Obama, when are you going to do something about the crooks???

[ooglymoogly]

26. The crux of this article, that on which everything else rests is

"Certain US customers" and one wonders why those words are even there. If it is truly so, that they are going to expose all the tax cheats...they better start passing out protection. Remember Heidi Fleiss who was conveniently suicided when she began exposing names and everything quickly was swept under the rug; All the ruling class Johns remained unexposed: Their congressional seats, Judgeships, and the like remained safe. Funny how you never hear about Heidi Fleiss anymore.

[flyarm]

33. Not Heidi Fleiss.it was the DC Madam: Deborah Jeane Palfrey

she died in Florida

eom

[Tunkamerica]

41. she's alive and was arrested in NV last year

was that a metaphorical suiciding?

[defendandprotect]

27. These Secret Swiss Bank Accounts are a threat to democracy . . .

and in this case a $20 billion threat to tax collections --

Almost 20,000 hiding their assets!

[madville]

28. I wonder how many politicians will get caught up in this ?

Probably some on both sides of the aisle sweating over this at the moment.

[newtothegame]

29. I'm kinda surprised we have any say in what Switzerland does with their banks...

Not that I don't like to see these fucks busted, but where's the sovereignty?

[Lucky Luciano]

36. They are operating in the US as an investment adviser...

although they are not licensed to do so....not to mention, they would not want the US Government to tell them to shut down all of their other businesses here (though had the government told them to get out three or four years ago, it might have saved them about $50B).

[specimenfred1984]

30. "charges of conspiring to defraud the United States", See how easy that is!

Now charge the entire Bush admin..

[Piewhacket]

31. Amazing. Shock. Go get em. n/t.

[flyarm]

34. One of my former neighbors is one of the top dogs at UBS..

he is mentioned in this article..but I won't say which one he is..

http://abcnews.go.com/Blotter/Story?id=6395333&page=1

[Tunkamerica]

37. Roni Deutch has those cheesy commercials that come on

during Judge Mathis. "Do you owe the IRS back taxes? I'm Roni Deutch and I can help get the IRS off your back."

[Mr. Hyde]

40. Payback time is coming.

[Hubert Flottz]

42. "$780 million" a drop in the old bucket...

But that drip, drip, drip...priceless! May Foreclosure Phil and his wife pay a huge price for their evil deeds also.

K&R! :kick:

[Joanne98]

43. UBS tax deal is Swiss bank secrecy's Waterloo

ZURICH (Reuters) - UBS's landmark settlement deal with U.S. tax authorities could be the final nail in the coffin for Switzerland's prized bank secrecy and will have far-reaching consequences for the whole offshore financial industry.

Under pressure from Washington, Berne agreed to let UBS pass on data of certain U.S. clients without waiting for an ongoing appeal process against the data transfer by some of these clients, an unprecedented step in Switzerland.

Switzerland's leading newspaper, Neue Zuercher Zeitung, called the $780 million settlement, which UBS agreed with Berne's blessing, a "capitulation."

"For Switzerland, it is a true catastrophe for the country's first industry, that is to say the banking sector," Geneva lawyer Charles Poncet, a former member of the Swiss parliament, told Radio Suisse Romande.

Switzerland is the world's biggest offshore center, managing about a third of an estimated $7 trillion of wealth. The industry has prospered thanks to undeclared accounts that protect the privacy of ultra-rich customers, whether from potential kidnappers or from tax authorities.

http://www.reuters.com/article/newsOne/idUSTRE51I1ZP20090219

[Baby Snooks]

46. Next comes seizure and extradition.......

Switzerland and Brazil do not allow seizure or extradition for "financial crimes" and I suspect the Swiss courts may intervene in this before disclosure is made. But I hope in fact they don't.

Time for the people who pay no taxes to pay their taxes. And time for people who helped them not pay their taxes to go to prison.

But of course they won't. This is America. Where the rich are different from the rest of us. The law does not apply to them. If they can afford to have the law look the other way.

You have to wonder what Phil Gramm's next criminal venture will be.

[WatchWhatISay]

47. Will 2009 turn out to be the Year of the Revenge of the Little Guy

Lets hope its just a start!

[progressoid]

49. Would be nice if this was the lead story on the TV snewz or headline the major newspapers.

[UpInArms]

50. wouldn't that be a real treat?!

ya'd think FAUX would be jumping on it? :sarcasm:

[progressoid]

52. Hey Rihanna breaking up with her boyfriend deserves some attention too!

:banghead::banghead::banghead::banghead::banghead:

[lisa58]

53. I am really looking forward to that list.

[UpInArms]

54. Update: Bank kept 52,000 secret Swiss accounts for U.S. taxpayers, IRS says

http://www.marketwatch.com/news/story/ubs-kept-52000-secret-bank/story.aspx?guid=%7B1264AD62-1C52-4444-8398-6D2E6B08E1DE%7D&dist=msr_1

SAN FRANCISCO (MarketWatch) -- UBS AG kept as many as 52,000 secret Swiss bank accounts for U.S. taxpayers and the firm should turn over information on all of them, the Internal Revenue Service said Thursday.

UBS (UBS: 10.56, +0.23, +2.2%) said it would fight the demand, citing Swiss
financial privacy laws, U.S. law and an agreement the bank already has with the IRS.
UBS agreed on Wednesday to pay $780 million in fines and other payments for helping U.S. clients avoid paying taxes. Switzerland's largest bank and the country's financial regulator also agreed to turn over the identities and account information of some of these customers to the U.S. government. See full story.

The move is unprecedented for a country that's built its banking industry on privacy for centuries. In agreeing to reveal the identities of some account holders, Switzerland is walking a fine line.

"Switzerland's offshore private banking industry is trying to assure its foreign investors that the country still provides the same level of protection as before, while at the same time ordering UBS to disclose names to U.S. authorities," Alois Pirker, a senior analyst at consulting firm Aite Group, said.

"This reassurance is extremely important," he added. "The ultra wealthy have many options available and will certainly not hesitate to move their assets should Switzerland prove to be an unreliable partner."

The IRS filed a civil lawsuit Thursday asking a U.S. district court in Miami to order UBS to disclose the identities of U.S. customers with secret Swiss bank accounts. The lawsuit claims as many as 52,000 U.S. taxpayers had these hidden accounts.

Roughly 20,000 accounts held securities, while 32,000 had cash in them. By the middle of this decade, the accounts held almost $15 billion in assets, according to the IRS.

...more...

52,000!!!!

[Joanne98]

55. UPDATE ... U.S. Sues UBS Seeking Swiss Account Customer Names

Feb. 19 (Bloomberg) -- The U.S. government sued UBS AG, Switzerland’s largest bank, to try to force disclosure of the identities of as many as 52,000 American customers who allegedly hid their secret Swiss accounts from U.S. tax authorities.

U.S. customers had 32,940 secret accounts containing cash and 20,877 accounts holding securities, according to the Justice Department lawsuit filed today in federal court in Miami. U.S. customers failed to report and pay U.S. taxes on income earned in those accounts, which held about $14.8 billion in assets during the middle of this decade, according to the court filing.

“At a time when millions of Americans are losing their jobs, their homes and their health care, it is appalling that more than 50,000 of the wealthiest among us have actively sought to evade their civic and legal duty to pay taxes,” John A. DiCicco, acting assistant attorney general in the Justice Department’s tax division, said in a statement.

The lawsuit came a day after UBS agreed to pay $780 million and disclose the names of about 250 account holders to avoid U.S. prosecution on a charge that it helped thousands of wealthy Americans evade taxes. The U.S. and Zurich-based UBS disagreed over how many account holders the bank must disclose to the Internal Revenue Service, agreeing to resolve it in court.

http://www.bloomberg.com/apps/news?pid=20601087&sid=aHxdrBYdaJD4&refer=home

:bounce: