IRS awards $104 million to Swiss bank tax whistleblower

[JURIST] An attorney for former UBS [corporate website] banker Bradley Birkenfeld announced on Tuesday that the US Internal Revenue Service (IRS) [official website] awarded Birkenfeld $104 million for information leading to an agreement between UBS and the IRS for $740 million in fines and penalties for its role in helping US clients shelter assets from US tax liability. This is reported to be the largest award [Reuters report] ever given by the IRS as part of their Whistleblower Informant Award [text] program. Birkenfeld is currently under house-arrest after being released last month from a 2009 sentence [JURIST report] for helping a client avoid paying over $7.2 million dollars in taxes in a related case.

Birkenfeld's information lead to significant actions in US efforts to put an end to tax-evasion through the use of overseas accounts. July 2010 the Swiss Federal Administrative Court [official website, in German] ruled that an agreement [text, PDF] with the US, allowing UBS to disclose client account information, is binding [JURIST report]. In November 2009, the DOJ and IRS announced that more than 14,700 Americans had reported to the IRS [JURIST report] previously hidden overseas bank accounts in response to a temporary forgiveness program [official website] allowing delinquent taxpayers to avoid criminal prosecution for tax evasion by paying all overdue taxes and penalties. In September of that year, the US and Switzerland signed a treaty [JURIST report] that would increase the amount of information shared between the two nations on would-be tax evaders. Earlier in 2009 the US reached a preliminary agreement with Switzerland over the identification of anonymous accounts [JURIST report] in Swiss banks, which would aid US officials in identifying those who seek to evade taxes.

 

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