UBS Executive Weil Charged by U.S. in Tax Conspiracy (Update2)
By Daniel at 12 November, 2008, 4:13 pm
--------------------------------------------------------------------------------------
--------------------------------------------------------------------------------------
By Ryan J. Donmoyer and Carlyn Kolker
Nov. 12 (Bloomberg) — A top UBS AG official was indicted by a U.S. grand jury on a single charge of conspiring to help 20,000 wealthy Americans hide assets from the Internal Revenue Service to maintain a “profitable” business for the Swiss bank.
Raoul Weil, 48, chairman of global wealth management at UBS in Zurich, was indicted Nov. 6 in Fort Lauderdale, Florida, according to court papers unsealed today. His bank continued to help American clients evade taxes with false documents after agreeing in 2001 to identify account holders and their income to the IRS, the U.S. alleged.
“Weil and other executives would not implement effective restrictions on the United States cross-border business because the business was too profitable for the Swiss bank,” according to the indictment, which also identifies other, unnamed UBS executives as unindicted co-conspirators. The executive faces up to five years in prison and $250,000 in fines if convicted.
The Justice Department has been probing whether the bank helped Americans evade taxes and the U.S. Securities and Exchange Commission is looking into whether it failed to register as a broker-dealer or investment adviser. In June, former UBS private banker Bradley Birkenfeld pleaded guilty to helping a California billionaire dodge taxes and agreed to cooperate with prosecutors.
UBS said in July it would stop offering offshore-banking services to American clients through non-U.S. branches after a Senate committee exposed its role in promoting tax evasion.
Cooperating With Probes
Mark Branson, chief financial officer of UBS’s global wealth-management unit, said July 17 that the company was cooperating with tax probes by U.S. prosecutors and regulators. The Senate Permanent Subcommittee on Investigations estimated the use of offshore accounts to hide money from tax authorities robs the U.S. Treasury of about $100 billion annually.
UBS bankers who weren’t licensed to conduct business or solicit clients in the U.S. frequently did so in an effort to woo wealthy Americans, the subcommittee said. The bank would seek clients interested in secret Swiss accounts and trusts, or shell companies in tax havens such as the British Virgin Islands, according to the subcommittee’s July report.
UBS spokesman Doug Morris didn’t return calls seeking comment. Weil couldn’t immediately be reached for comment after normal business hours in Zurich, where UBS is based.
In an Aug. 21 letter to its American clients, UBS offered to send a check for the value of accounts it was closing effective Oct. 6 or to hold a check at bank offices for clients to pick up. The bank charged a 200 Swiss Franc processing fee for the check.
“Depending on your individual circumstances, UBS further recommends that you consult with your U.S. tax advisor or tax preparer to file, if necessary, amended U.S. tax returns pursuant to the IRS’s Voluntary Disclosure program,” the bank said.
--------------------------------------------------------------------------------------
--------------------------------------------------------------------------------------
No comments yet.