Articles Posted in tax evasion foreign accounts

Billionaire Sam Wyly off Texas defrauded the IRS by shifting his assets between a grouping of offshore trusts and evaded millions in taxes, a federal judge has ruled. The SEC had filed a lawsuit against Wyly and his brother in 2010 and in 2014, a federal jury in Manhattan found the brothers had used a network of offshore trusts to hide stock holdings. This allowed them to take in $550 million in illegal profit. That caused the filing of a bankruptcy action by Sam Wyly.

Wyly and his brother got rich building business that included the arts and crafts chain Michaels stores.

The IRS seeks to recover $1.4 billion from Sam Wyly and $834 million from his sister in law with penalties.

Bank Leumi Israel’s largest bank will pay $400 million to settle allegations that it helped American clients evade taxes on overseas income in a criminal conspiracy that operated for more than a decade. The Department of Justice said the Bank Leumi helped hide American customers’ accounts at the bank’s locations in Israel, Switzerland, Luxembourg and the U.S. The improper activities included:

  • Secretly sending private bankers from Israel and elsewhere into the U.S. and meeting with U.S. clients in hotels, parks and coffee shops to discuss efforts to hide income and assets.
  • Aiding American clients in creating nominee corporate entities in Belize and other jurisdictions to hide undeclared accounts and disguise the true ownership.

The number of Americans giving up their U.S. citizenship is at an all time high because of the new rules created to pursue tax evaders. In the first half of this year 1,577 Americans gave up their citizenship. The law which is causing this is called the Foreign Account Tax Compliance Act and the new rules require foreign banks, including those in Switzerland to turn over data on American clients to the United States Government.

 100 Swiss banks are handing over information to avoid prosecution for helping tax evaders, leading 576 American expatriates to renounce their citizenship in the second quarter.

The USA is the only Organization for Economic Cooperation and Development nation that taxes citizens wherever they live. This means that to expats who want to avoid paying higher, U.S. level taxes, the idea of giving up their passports is becoming more attractive.