Sunday, November 16, 2008
A potential tax windfall?
The notorious Swiss banking giant UBS is closing the Swiss based accounts of US citizens and telling them to go elsewhere.
Arena said UBS is closing all Swiss-based accounts owned by private clients domiciled in the United States. A Senate report earlier this year estimated there were about 20,000 of those with about $18 billion on deposit.The accounts being closed are those used to hide tax liabilities from the IRS. This action is a response to the recent plea bargain of one of its bankers.
UBS has been under pressure from the U.S. government since June, when a former UBS banker named Bradley Birkenfeld pleaded guilty to helping an American real estate developer hide $200 million of assets and evade $7.2 million of taxes. Birkenfeld has been cooperating with U.S authorities in a widening investigation that led to the federal indictment of one of UBS's top executives.And all of a sudden, UBS doesn't want to have anything to do with these dodgy accounts, after profiting nicely from them until now. So after all the money has returned to the light of day and all the amended tax returns filed, the US should get their pound of flesh from UBS for their part in the conspiracy to commit tax fraud. It won't fund a day of AIG, but it will be nice to think that everybody is pulling their own weight.
The indictment by a grand jury in Florida, which was unsealed this week, accused executive Raoul Weil of conspiring with a host of others at the bank to market Swiss bank secrecy to American clients and help them dodge taxes. A lawyer for Weil denied the charges and said he would seek vindication. Meanwhile, UBS has given U.S. authorities the names of about 70 clients who wired money from UBS accounts in the United States to UBS accounts in Switzerland.
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