WASHINGTON – Raoul Weil, a senior executive of a large Swiss bank with offices worldwide, including the United States, has been charged with conspiring with other executives, managers, private bankers and clients of the banking firm to defraud the United States, the Justice Department and Internal Revenue Service (IRS) announced today.
According to the criminal indictment, between 2002 and 2007, Weil oversaw the Swiss bank’s cross-border private banking business that provided services to some 20,000 U.S. clients who reportedly concealed approximately $20 billion in assets from the IRS. Weil, who allegedly referred to this business as "toxic waste," mandated that Swiss bankers grow the cross-border business, despite knowing that this would cause bankers to violate U.S. law.
According to the indictment, when given a choice to wind down, sell or spin off the cross-border business, Weil chose to continue the business because of its profitability. Between 2002 and 2007, the United States cross-border business generated between $200 million a year in revenue for the Swiss bank.
The indictment alleges that through the use of nominee entities, encrypted laptops, numbered accounts and other counter surveillance techniques, Weil and others at the bank assisted U.S. clients conceal their identities and offshore assets from the IRS.
Swiss bankers allegedly routinely traveled to the United States to market Swiss bank secrecy to U.S. clients interested in attempting to evade federal income taxes. In 2004 alone, Swiss bankers, who ultimately reported to Weil, traveled to the United States approximately 3,800 times to discuss their clients’ Swiss bank accounts. Clients of the cross-border business filed false tax returns which omitted the income earned on their Swiss bank accounts and failed to disclose the existence of those bank accounts to the IRS.
"Professionals, including bankers, who promote fraudulent offshore tax schemes against the United States, will be held accountable," said John A. Marrella, Deputy Assistant Attorney General of the Justice Department's Tax Division. "These individuals face severe consequences including imprisonment and substantial fines."
"The IRS is aggressively pursuing anyone who helps wealthy individuals hide their assets offshore and dodge the tax system," said IRS Commissioner Doug Shulman. "As the global commerce and capital flows continue to increase, we have stepped up our efforts on international tax evasion."
"Every American who pays his or her taxes should be offended that a select few use anonymous offshore accounts to avoid paying their fair share," said R. Alexander Acosta, U.S. Attorney for the Southern District of Florida. "We owe it to every American taxpayer to use all lawful means to identify and prosecute both those who evade their taxes, and those who assist them in evading their tax obligations."
The prosecution is being handled by senior trial attorney Kevin M. Downing and trial attorney Michael P. Ben’Ary of the Justice Department’s Tax Division, and Jeffrey A. Neiman, an Assistant U.S. Attorney in the Southern District of Florida.
An indictment is merely an allegation and a defendant is presumed innocent until proven guilty beyond a reasonable doubt.