Swiss Bank Enters Into Amended Non-Prosecution Agreement With DOJ, Pays Additional $14 Million Fine

St. Louis Man Sentenced to Prison in Tax Fraud Scheme
January 25, 2020
Do Not Let Downtick in IRS Audits Fool You, Increased Enforcement May Be Around the Corner
January 27, 2020

Swiss Bank Enters Into Amended Non-Prosecution Agreement With DOJ, Pays Additional $14 Million Fine

According to a Department of Justice press release, Union Bancaire Privée, UBP SA (UBP), a Geneva, Switzerland-based bank recently entered into an amended non-prosecution agreement with the Department of Justice. The need for an amended agreement was due to UBP not fully complying with the terms of its original non-prosecution agreement with the Department of Justice. This story is a reminder to taxpayers who may have unreported foreign bank accounts that the IRS and the Department of Justice are still actively rooting out those who have violated bank account and foreign taxable income reporting laws. If you have a foreign bank account that is not reported on an annual basis, as required by U.S. law, it may be in your best interest to contact an experienced FBAR defense attorney today.

A Brief History of the Swiss Bank Program

The Swiss Bank Program was established by the Department of Justice to provide Switzerland-based banks a path to avoid criminal prosecution for their role in allowing U.S. residents to violate U.S. laws, including tax evasion and those relating to mandatory foreign bank account disclosure. The program required that participants pay a fine and provide detailed information about their U.S. account holders from 2008 through the end of 2014. Furthermore, Swiss banks participating in the Swiss Bank Program were also required to provide additional information relating to U.S. accounts on an ongoing basis. In exchange for complying with the above provisions, the Swiss Bank Program provided that participating banks would not face criminal prosecution in the United States.

Between early 2015 and 2016, 80 Swiss banks entered the program and received non-prosecution agreements from the Department of Justice. One of those banks was UBP. The addendum to the non-prosecution agreement requires UBP to pay $14,000,000 of additional fine and disclose information on an additional 97 bank accounts that it should have previously provided under the original non-prosecution agreement terms. UBP had originally paid a fine of over $187,000,000.

Understanding FBAR Requirements for U.S. Residents

The need for the United States to monitor Swiss banks stems from blatant violations of Foreign Bank Account Reporting (FBAR) laws. Such laws require U.S. residents to report, on an annual basis, the existence of foreign bank accounts with balances that meet or exceed $10,000. Penalties for FBAR violations are harsh and have even been described as draconian. Willful violators of FBAR rules face penalties of up to 50 percent of the high balance of the undeclared foreign bank account for each year that the bank account went unreported. Furthermore, willful FBAR violators also face federal prison time if convicted.

Understanding When to Contact a Tax Defense Attorney

If you have a foreign bank account that has gone unreported, it is in your best interest to contact an experienced FBAR attorney. As mentioned above, the government has increased their enforcement of FBAR laws and have entered various information sharing agreements with countries around the world. Such agreements have given the U.S. a look into the financial institutions in foreign countries where Americans may be holding some of their funds. If the government determines that a willful failure to file an FBAR has occurred, a civil penalty of up to half of the balance of the account at the time of the violation (or $100,000, whichever is higher) can be assessed. Additionally, the government can commence criminal FBAR charges against an individual, which can result in additional fines and carry a lengthy prison sentence.

See our 2011 OVDI Q and A Library

See our FBAR Compliance and Disclosure Q and A Library 

See our Foreign Audit Q and A Library

The tax and accounting professionals at the Tax Law Offices of David W. Klasing have represented many taxpayers who have had foreign bank account reporting-related issues. An experienced FBAR attorney can assist in the development of a plan of action that will consider your specific set of circumstances. Our team of zealous advocates will be there every step of the way and will place your physical freedom and financial well-being as a priority. Do not let the threat of civil or criminal FBAR penalties keep you up at night. Contact the Tax Law Offices of David W. Klasing today for a reduced-rate consultation.

In addition to our staffed main offices in Irvine,  the Tax Law Offices of David W. Klasing has unstaffed (conference room only) satellite offices in Los Angeles, San Bernardino, Santa Barbara, Panorama City, Oxnard, San Diego, Bakersfield, San Jose, San Francisco, Oakland, Carlsbad and Sacramento.

 

Note: If you have concerns about the privacy of our initial or subsequent communication and are unable to easily travel to our Irvine / Orange County Main Office, consider scheduling a GoToMeeting to safely and securely establish an initial or maintain an existing attorney client relationship.  With end-to-end encryption, strong passwords and top-rated reliability, no one is messing with your meeting. To schedule a reduced rate initial consultation via GoToMeeting follow this link.   Call our office and request a GoToMeeting if you are an existing client. We are generally happy to travel to any of our appointment only satellite offices for a subsequent meeting in appropriate circumstances once a relationship is established via a signed engagement letter and the payment of an initial retainer or where enough retainer is available where a current client to cover the reasonable travel time and time required for the meeting.

Will it cost me more to hire the Tax Law Offices of David W. Klasing, who’s main office and the vast majority of the firm’s staff is located in Irvine California, but an appointment only Satellite office is close to my location, as opposed to a local company?  Absolutely not!  See our policies that address this issue here.