Swiss bank BSI fined US$211 mil. penalty in tax eva­sion scheme case

The China Post - - WORLD BUSINESS -

Swiss Bank BSI will pay a US$ 211 mil­lion penalty af­ter ac­knowl­edg­ing it helped clients cre­ate sham iden­ti­ties to evade U.S. taxes, the Jus­tice Depart­ment an­nounced Mon­day.

BSI em­ployed myr­iad schemes to fa­cil­i­tate tax eva­sion, such as cre­at­ing false-front cor­po­ra­tions and trusts to hide money.

BSI had more than 3,000 ac­tive ac­counts se­cretly tied to U.S. tax­pay­ers af­ter 2008, many of which it knew were not dis­closed to U.S. au­thor­i­ties, Jus­tice said.

Un­der a two-year de­ferred pros­e­cu­tion agree­ment, BSI agreed to make a com­plete dis­clo­sure of cross-bor­der ac­tiv­i­ties, as­sist pros­e­cu­tors with all in­ves­ti­ga­tions re­lated to the case and en­sure that all new ac­counts will be de­clared to the U.S.

BSI came for­ward to U.S. pros­e­cu­tors un­der a 2013 pro­gram started by Jus­tice’s tax di­vi­sion to en­cour­age banks to self-dis­close vi­o­la­tions. Jus­tice ex­pects sim­i­lar agree­ments in the “near fu­ture”, said As­sis­tant At­tor­ney-Gen­eral Caro­line Ci­raolo.

“The pro­gram of­fers a unique op­por­tu­nity for Swiss banks to come for­ward vol­un­tar­ily, ad­mit to crim­i­nal con­duct, pay an ap­pro­pri­ate penalty, and as­sist the depart­ment in its in­ves­ti­ga­tions of other fi­nan­cial in­sti­tu­tions, U.S. ac­count hold­ers, and in­di­vid­u­als who fa­cil­i­tated and prof­ited from the con­ceal­ment of for­eign ac­counts by U.S. tax­pay­ers,” Ci­raolo said.

More than a dozen Swiss banks that were al­ready un­der crim­i­nal in­ves­ti­ga­tion were ex­cluded from the ini­tia­tive, called the “Swiss Bank Pro­gram.”

That in­cluded Credit Suisse, which was fined US$2.6 bil­lion last year for help­ing Amer­i­cans hide money off­shore to avoid taxes. As part of the set­tle­ment, Credit Suisse ad­mit­ted guilt on a felony charge.

The ini­tia­tive has also net­ted more than US$7 bil­lion to the U.S. Trea­sury from in­di­vid­ual tax­pay­ers seek­ing to get into com­pli­ance.

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