It looks like you're using an Ad Blocker.
Please white-list or disable AboveTopSecret.com in your ad-blocking tool.
Some features of ATS will be disabled while you continue to use an ad-blocker.
Swiss bank UBS AG "systematically and deliberately" violated U.S. law by dispatching private bankers to recruit wealthy Americans interested in evading taxes and must be forced to reveal the identities of 52,000 of those clients, the Justice Department said in a court filing Tuesday.
The filing, which comes amid several published reports that the case may be near settlement, urges U.S. District Judge Alan S. Gold to hold UBS accountable for conducting years of illegal business on U.S. soil — business that earned the bank more than $100 million in fees but cost the U.S. hundreds of millions of dollars in unpaid taxes.
"It is time for UBS to face the consequences that it has brought upon itself," said Justice Department tax attorney Stuart Gibson in the 55-page filing. "The United States has proven its case for enforcement."
UBS spokeswoman Karina Byrne said the bank is "open to an appropriate solution" short of going to court but said no settlement has been completed. In a statement, she repeated UBS's contention that disclosing the U.S. taxpayer names would violate Swiss law and that the dispute should be resolved by the two governments rather than the courts.
The IRS summons seeks the identities of all U.S. taxpayers who had an "undeclared" account at UBS between 2002 and 2007. Many of these UBS clients have already voluntarily come forward to settle tax obligations with the IRS, Byrne said.
Zurich-based UBS wrote to its U.S.-based clients in March and April telling them to close their accounts within weeks and transfer any money to a specially created U.S. unit, to another bank or to withdraw the funds. That grace period ends July 1, according to the source close to the bank who requested anonymity because of the sensitivity of the matter.
"In sum, UBS has admitted that its bankers committed very serious crimes on U.S. soil, in ways that subjected UBS to the full jurisdiction of the IRS and the courts of the United States," Gibson said in the U.S. filing.
Miami ederal prosecutors also have obtained an indictment charging former UBS senior executive Raoul Weill with tax evasion conspiracy for his role in handling cross-border business and private banking. Weill remains in Switzerland and has been declared a fugitive from justice.
UBS previously reached a deferred prosecution agreement with the Justice Department in which it agreed to disclose the identities of up to 300 U.S. clients and pay $780 million to the U.S. government. In that deal, UBS admitted regularly violating U.S. law through its client recruitment methods, use of sham offshore entities and filing of false paperwork.