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BOSTON INVESTOR SENTENCED FOR HIDING ASSETS OVERSEAS AT UBS

Wednesday, October 5, 2011

BOSTON, Mass...A Boston man was sentenced today in federal court for concealing from the Internal Revenue Service (IRS) assets held in accounts at the Swiss banking giant UBS AG.

PETER SCHOBER, 51, was sentenced by U.S. District Judge Nathaniel M. Gorton to one month imprisonment, to be followed by two months of home confinement as part of a total of six months of supervised release and a $3,000 fine. SCHOBER has also paid $77,870 in restitution to the IRS and a civil penalty of $777,986. SCHOBER pleaded guilty to willfully failing to file a Report of Foreign Bank and Financial Accounts (“FBAR”) on November 23, 2010.

Under federal law, when filing an Individual Income Tax Return (Form 1040), U.S. taxpayers are obligated to report their worldwide income. Taxpayers who have a financial interest in, or signature or other authority over, a financial account in a foreign country with an aggregate value of more than $10,000 at any time during a particular year are also required to file an FBAR with the IRS.

From at least 2000 to 2008, UBS AG helped U.S. taxpayers conceal their Swiss-based accounts and the income earned in those accounts from the IRS. UBS and the U.S. taxpayers, assisted by independent Swiss attorneys and financial advisers, hid these assets from the IRS by listing sham offshore companies as the account holders of UBS accounts, when in fact the U.S. taxpayers actually owned and controlled the accounts. In February 2009, UBS entered into a deferred prosecution agreement with the United States, in which the bank admitted to helping U.S. taxpayers hide accounts from the IRS. As part of this agreement, UBS provided the U.S. Government with the identities of, and account information for, certain U.S. customers of UBS’s U.S. cross-border banking business.

In December 2000, Schober, with the assistance of UBS representatives and agents, established Small Guard Foundation, a Panamanian corporation with no operations, and in 2002 opened an account at UBS in its name. Schober established the account in the shell corporation’s name for the purpose of concealing his control over funds deposited into the account. Over the next five years, Schober deposited in excess of $1,000,000 into the account from income sources and his existing domestic accounts.
Schober filed FBARs that omitted any indication that he had an interest in the Small Guard Foundation account. On his individual income tax returns, Schober similarly hid his interest in the account. In so doing, Schober deprived the IRS of $77,870 in taxes.

United States Attorney Carmen M. Ortiz; John A. Dicicco, Acting Assistant Attorney General of the Department of Justice’s Tax Division; and William P. Offord, Special Agent in Charge of the Internal Revenue Services’s Criminal Investigation in Boston made the announcement. The case was prosecuted by Assistant U.S. Attorney Andrew E. Lelling of Ortiz’s Economic Crimes Unit and Trial Attorney Mark Daly of the Tax Division of the Department of Justice.

 

 

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