California refunds back on track, too
Foreign tax havens, foreign tax credits

Tax secrets are out ... maybe

On Wednesday, U.S. tax investigators were convinced they had hit the tax evasion jackpot.

Today, however, the feds headed to court in an attempt to force Switzerland's biggest bank to pony up the full payout.

UBS building The Department of Justice (DoJ) thought a deferred prosecution agreement it reached with UBS AG would result in the IRS finding out just who had been stashing cash in secret Swiss bank accounts in order to avoid paying U.S. taxes.

As part of the deal and, according to the DoJ, "in an unprecedented move," UBS agreed to immediately provide the U.S. government with "the identities of, and account information for, certain United States customers of UBS's cross-border business."

Apparently the word "immediately" was lost in translation.

When investigators didn't get the account owner info, the Justice Department wasted no time.

Today, just 24 hours after the upbeat announcement of the UBS deal, the feds filed suit in a Miami federal court seeking enforcement of a 2008 IRS "John Doe" summons for the names of all Americans with "undisclosed" accounts at UBS.

Waiting for 52,000 names: In the court papers, the government estimated that 52,000 individuals -- a substantial increase over the original 19,000 American citizens -- were suspected of evading taxes via Swiss accounts.

That larger number reflects more than 30,000 American accounts that hold cash but not securities. Those accounts had not been disclosed in previous public statements by either the U.S. government or UBS.

Federal investigators also noted in today's filings that so far UBS has turned over the names of only 323 Americans who wired money from their American accounts to Switzerland. All the documents UBS turned over, however, were U.S. records, not from the Swiss financial institution.

"At a time when millions of Americans are losing their jobs, their homes and their health care, it is appalling that more than 50,000 of the wealthiest among us have actively sought to evade their civic and legal duty to pay taxes," said John A. DiCicco, Acting Assistant Attorney General for the Justice Department's Tax Division. "It is time for those who are trying to hide from the IRS to rethink their actions. The Department of Justice is committed to do all that it can to aid the IRS in locating those who would seek to hide behind secret accounts and in holding them accountable under the federal tax laws."

The head of the IRS also added his support to the legal action.

"We are committed to moving forward with the summons enforcement process. This action sends a strong signal to taxpayers hiding their money offshore." said IRS Commissioner Doug Shulman. "As Commissioner, I am committed to bringing to bear the full arsenal of IRS resources to pursue egregious offshore tax abuse. International tax issues are a top priority, and we will continue to aggressively pursue people hiding assets offshore. For people who are hiding money offshore, this serves as a wake-up call that they need to get right with their government."


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Linda Ramsey

Thanks for the information. I will be back for more.


Did this start with the notorious diamond-smuggling investment banker (

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