Call Now (800) 681-1295

California man faces up to 8 years in prison and over $1,000,000 in fines for filing false tax returns pertaining to foreign accounts

Table of Contents

    Michael Clifford Francis of Alhambra California pled guilty in Los Angeles federal court to one count of subscribing a false income tax return and one count of failing to disclose interests in foreign bank accounts. For his indiscretions, he now faces a maximum sentence of 8 years in prison and a fine of at least $500,000. Additionally, he must also pay the IRS a penalty of 50 percent of his highest foreign account balance, approximately $896,000.

    From January 2002 through December 2011, it was learned that Francis had various sums of money in a UBS bank in Zurich, a HSBC Bank on the island of Jersey in the Channel Islands, and a Commerz Bank in Germany. During the investigation Francis admitted that for consecutive years he failed to disclose the accounts entirely and in 2007 he also did not disclose the interest earned from the account in Germany.

    In an effort to evade detection, Francis shuttled money into his domestic accounts through structured deposits of less than $10,000. All cash transaction of $10,000 or more are required to be reported to federal authorities. Francis will be sentenced in February.

    This latest incident is consistent with the ramped up pursuit of tax evaders with foreign accounts. Moreover, it is clear that penalties for FBAR violations can and do exceed balances in foreign financial accounts. If you learn you were required to file FBARs for earlier years, but you dutifully reported your foreign income related to the accounts, you should file with the advice of counsel the delinquent FBAR reports and attach a statement explaining why the reports are filed late. No penalty will be asserted if the IRS determines that the late filings were due to reasonable cause. Not knowing of the FBAR filing requirement is reasonable cause. However if even deminimus amounts of foreign income was omitted from your U.S. returns you need legal assistance. Our office has lots of experience in this practice area.

    Tax Help Videos

    Representing Clients from U.S. and International Locations Regarding Federal and California Tax Issues

    Main Office

    Orange County
    2601 Main St. Penthouse Suite
    Irvine, CA 92614
    (949) 681-3502

    Our headquarters is located in Irvine, CA. Our beautiful 19,700 office space is staffed full-time and always available for our clients to meet with our highly qualified and experienced staff of Attorneys, Certified Public Accountants and Enrolled Agents. We also offer virtual consultations and can travel to meet with clients in one of our satellite offices.

    Outside of our 4 hour initial consultation option, we do not charge travel time or travel expenses when traveling to one of our Satellite offices, or surrounding business districts, where it is necessary to meet personally with taxing authority personnel, make court appearances, or any in person meeting deemed necessary for the effective representation of a client. To make this as flexible, efficient, and convenient as possible, David W. Klasing is an Instrument Rated Private Pilot and Utilizes the Firms Cirrus SR22 to service client’s in California and in the Southwest by air. Offices outside these areas are serviced via commercial jet airlines. None of these costs are charged to our clients.

    Satellite Offices

    (310) 492-5583
    (760) 338-7035
    (916) 290-6625
    (415) 287-6568
    (909) 991-7557
    (619) 780-2538
    (661) 432-1480
    (818) 935-6098
    (805) 200-4053
    (510) 764-1020
    (408) 643-0573
    (760) 338-7035
    (602) 975-0296
    New Mexico
    (505) 206-5308
    New York
    (332) 224-8515
    (512) 828-6646
    Washington, DC
    (202) 918-9329
    (702) 997-6465
    (786) 999-8406
    (385) 501-5934