Wegelin & Company, Switzerland’s oldest private bank – founded in 1741 – has pleaded guilty to tax law violations and admitted helping Americans evade taxes; in the latest stage of the global crackdown on offshore banking based tax evasion. Following the plea the bank announced that it was going to close down permanently.
In Manhattan’s Federal District Court Wegelin & Co. officials admitted that the firm helped wealthy American customers evade taxes by hiding more than $1.2 billion in secret accounts, from 2002 – 2010. The firm had an elaborate scheme to hide the trail: involving secret accounts; code names; sham entities; and using countries with opaque reporting regimes, including Panama and Liechtenstein. Otto Bruderer, a Wegelin partner said the practice was common practice in the Swiss banking industry.
Wegelin was headquartered in St. Gallen, Switzerland. According to a report in The New York Times by Peter Lattman, in a moment of hubris, a web site marketing Wegelin’s services said, “Neither the Swiss government nor any other government can obtain information about your bank account.”
As well as pleading guilty and closing down, Wegelin agreed to pay $74m in fines; restitution; and forfeiture proceeds. The bank has said it’s now shutting down for good. However, the firm’s partners sold its non-American client accounts last January to the Raiffeisen Group, an Austrian bank, just before its indictment.
Nate Raymond and Lynnley Browning at Reuters described this as “a major turning point in the battle against Swiss bank secrecy”. But went on to say that “It is unclear whether the bank was required to turn over American client names who held secret Swiss bank accounts”.
Reuters went on to say that the following banks are also under scrutiny: Credit Suisse; Zurich based Julius Baer; some cantonal banks; UK-based HSBC Holdings; and 3 Israeli banks: Hapoalim; Mizrahi-Tefahot Bank Ltd; and Bank Leumi.
What does this mean for me?
Almost daily more and more stories are emerging of the tax authorities around the world obtaining information from offshore banks; and prosecuting the bankers and the customers of those banks. If you have undeclared tax liabilities in the UK linked to an offshore bank (e.g. such as a Swiss Bank, Isle of Man bank; Channel Islands bank; Bermuda bank) then you may well be worried by these developments, and the aggressive approach of the taxman. Now is the time to consider avoiding prosecution, and obtaining reduced penalties, by making a voluntary disclosure of your tax irregularities. There are favourable terms offered the current UK offshore bank account tax amnesty. In particular the Liechtenstein Disclosure Facility is available to all taxpayers – and not only those with prior connections to the principality.
How can Lynam tax offshore experts help me?
Lynam Tax disclosure experts have a massive amount of experience in dealing with clients with offshore accounts, and in making tax disclosures. In particular we are currently helping a large number of clients with the Liechtenstein Disclosure Facility. Do not delay!
For a free initial consultation on a no obligation basis call Paul Lynam now on: 0845 643 9997 or Andrew Nutbrown on 07718 778710