After a six year long criminal investigation by the U.S.
Department of Justice, Credit Suisse AG pleaded guilty in federal court on May
19, 2014 to federal charges that it had engaged in a decades long criminal conspiracy to aid and assist
U.S. taxpayers in filing false income tax returns and other documents with the
Internal Revenue Service (IRS).
According to the
plea agreement, Credit Suisse has agreed to pay a total of $2.6 billion; $1.13
billion fine to the Department of Justice, $670 million restitution to the IRS,
$100 million to the Federal Reserve, and $715 million...
There was a time when offshore financial secrecy laws were ironclad
and impenetrable. Some used those laws to engage in legitimate financial activities
directed at investing, increasing wealth and facilitating international trade, but
many others used them to hide the proceeds of illegal activities, disguise the ownership
of personal assets and, more often than not, avoid or evade payment of required
This really wasn’t anything new. In a letter to U.S. President Franklin D.
Roosevelt in May of 1937, then Secretary of the Treasury Henry Morgenthau, Jr.
described one of...
If you blinked, you probably missed the news. On January 29, 2013, a federal judge sitting
in New York City authorized the IRS to issue a John Doe summons to UBS AG in
Stamford, Connecticut for the correspondent bank records of Wegelin Bank of
Switzerland and at least two other Swiss banks that nested their correspondent
accounts with Wegelin. Only a few media outlets thought
it newsworthy enough to report the event, apparently seeing it as merely the
next step in the Wegelin case … just another bump in the road. Those that did report the story covered it primarily
There was a time when offshore financial secrecy was an absolute. It didn’t matter if you were a dictator
plundering the wealth of your own nation, an illegal arms dealer, a money
launderer, a corrupt politician, a trafficker in human lives or simply a tax
evader … what happened in a financial secrecy jurisdiction stayed in the financial
secrecy jurisdiction. Nowhere was that
more sacrosanct than in Switzerland, a great nation made up of a great peoples
that had embraced hundreds of years of absolute financial secrecy as a rich
national tradition … and then there was UBS.
I interviewed many offshore whistleblowers and potential
whistleblowers during my time with the IRS, some high profile and some known
only to the IRS and myself. It’s always
surprised me how many people think whistleblowing is only about the money. In fact, I’ve attended conferences, including
the OffshoreAlert conference, where regulators, attorneys and subject matter
experts talked exclusively about the money … how much can be received, how much
has been paid out to date and even how much could be in it for you. While money is certainly a big motivator for
all of us, when it...
I first met Bradley Birkenfeld on October 12, 2007. By law, the only thing I can say about that
meeting and what followed is what has been included in the declarations I
filed in federal court in support of the IRS petition seeking permission to
issue a John Doe summons to UBS AG of Switzerland and the subsequent petition
seeking a court order to enforce the summons.
Since that day, much has changed in the world of offshore
financial secrecy and Swiss bank secrecy in particular. What was once thought of as an impenetrable
wall of financial secrecy has been pierced and is now...
After 35 years of service I decided to retire from the
Internal Revenue Service effective June 30. 2012. During that time, I was fortunate to have
worked on many interesting matters, led some of IRS’s highest profile anti-money
laundering and offshore tax investigations and worked with and for some of the brightest,
most talented and dedicated civil servants in the United States government.
In the 1990s, I led the first anti-money laundering investigations
into the casino gambling industry under the Bank Secrecy Act, worked closely
with the Financial Crimes Enforcement Network...
Part and parcel of working with financial professionals in
multiple jurisdictions is a modicum of privacy. Privacy in life choices, privacy in investment choices, and privacy - no
secrecy - when it comes to making strategic investment choices.
Yes I said secrecy - if money center banks and trust company
can refuse to produce their internal methods of analysis and risk weighting on
investment choices because it is a Trade Secret and a proprietary art, we must
take the very same stance to preserve our investment knowledge advantage. After all the value of a trade secret
In June 2011, the FSC released for consultation a draft Bill (the “BVI Business Companies (Amendment) Bill 2011”) containing a number of mainly “housekeeping” amendments to the BC Act, along with draft Regulations (the “BVI Business Companies Regulations, 2011”).
The proposed changes have already gone through a consultation process, and cover matters including the introduction of not-for-profit companies, and a framework for the use of foreign character names and the re-use of former company names.
At the current time, there is no indication when a Bill will be introduced, but it...
A recent legislative highlighting the increasing sophistication of the BVI as a financial centre is the Mortgaging of Aircraft and Aircraft Engines Act 2011. This new Act follows on from the first aircraft registering in the BVI three years ago.
The objective behind this new law is for the BVI to be a leading aircraft registration jurisdiction by enabling the registration of charges over BVI-registered aircraft and aircraft engines owned by BVI incorporated companies. This reform is considered to be a significant development as banks and other financial services prefer lending to...