Skokie Business Owner Charged With Tax Evasion For Allegedly Hiding Funds In Secret Offshore Account With Swiss Bank UBS
CHICAGO — The owner of a cemetery monument business in Skokie was charged with federal tax evasion for allegedly failing to report all of his income, including money he held in a secret offshore financial account with UBS, a global financial services firm headquartered in Switzerland. The defendant, PETER TROOST, was charged in a felony information filed late yesterday in U.S. District Court.
Troost, 78, of Skokie, owns and operates Troost Memorials, a closely-held company that designs and sells cemetery monuments and gravestones. The business is located in a strip mall that Troost owns at 9853 Gross Point Rd., Skokie, and he owns another strip mall located at 1816-44 Arlington Heights Rd., in Arlington Heights. The defendant is not involved with Peter Troost Monument Company, of Hillside, which is a different company from Troost Memorials.
Troost will be arraigned in U.S. District Court on a date yet to be determined.
Troost is the first taxpayer charged in Federal Court in Chicago in connection with an ongoing investigation of U.S. taxpayer clients of UBS and other overseas banks that hid foreign accounts from the Internal Revenue Service. In February 2009, UBS entered into a deferred prosecution agreement with the United States, admitting that it helped taxpayers hide accounts from the IRS. As part of the agreement, UBS provided the government with the identities of, and account information for, certain customers of UBS’ U.S. cross-border banking business.
According to the charging document, Troost maintained at least one offshore account with UBS, which he managed with the assistance of a UBS personal banker based on the island of Jersey.
In 2007, Troost received gross income of at least $647,040, and owed federal income tax of at least $212,503, the charge states. Troost allegedly attempted to evade payment of at least $193,641 of that income tax by maintaining a secret Swiss account with UBS, to which he transferred income earned in the United States and also earned additional interest income in that account.
On his federal income tax returns for 2007-09, Troost allegedly stated that his total income was $80,271.35 in 2007; $60,802.37 in 2008; and $211,256.86 in 2009, when he knew that his total income was actually greater than those amounts in each of those years. In addition, Troost allegedly stated on his returns for each of those years that he did not have an interest in a financial account in a foreign country, when, in fact, he knew he maintained the offshore UBS account.
The charge was announced today by Gary S. Shapiro, United States Attorney for the Northern District of Illinois, and James C. Lee, Special Agent-in-Charge of the Internal Revenue Service Criminal Investigation Division in Chicago.
“With the April tax deadline looming, we encourage taxpayers to think of the serious consequences, including civil and criminal penalties, for willfully presenting false information on their federal tax returns. All taxpayers must honor their obligation to report all of their income and pay all of the taxes they owe,” Mr. Lee said.
Tax evasion carries a maximum penalty of five years in prison and a $250,000 fine. In addition, a defendant convicted of tax offenses faces mandatory costs of prosecution and remains civilly liable to the government for any and all back taxes, as well as a potential civil fraud penalty of up to 75 percent of the underpayment plus interest. Federal tax law requires U.S. taxpayers pay taxes on all income earned worldwide. Taxpayers must also report foreign financial accounts if the total value of the accounts exceeds $10,000 at any time during the calendar year. A deliberate failure to file a Report of Foreign Bank and Financial Accounts (FBAR) with the U.S. Treasury Department can result in a penalty of up to 50 percent of the amount in the account at the time of the violation. If convicted, the Court must determine a reasonable sentence to be imposed under federal statutes and the advisory United States Sentencing Guidelines.
The government is being represented by Assistant U.S. Attorney Brian Havey.
The public is reminded that an information contains only charges and is not evidence of guilt. The defendant is presumed innocent and is entitled to a fair trial at which the government has the burden of proving guilt beyond a reasonable doubt.