Department of Justice Seal Department of Justice
FOR IMMEDIATE RELEASE
THURSDAY, MARCH 28, 2002
WWW.USDOJ.GOV
TAX
(202) 514-2007
TDD (202) 514-1888

COURT APPROVES IRS SUMMONS FOR OFFSHORE CREDIT CARD RECORDS

Records From Visa International Will Identify People Who Use Offshore Credit Cards To Evade Federal Income Taxes


WASHINGTON, D.C. A federal court in San Francisco, Calif. on Wednesday issued an order authorizing the IRS to serve a summons on VISA International for offshore credit card records. The court acted just two days after the Justice Department filed a petition for approval of a "John Doe" summons, which permits the IRS to obtain information about possible tax fraud by people whose identities are unknown.

The information expected in response to the summons will help the IRS identify people who use offshore accounts to evade their United States income tax liabilities. The IRS suspects people have been committing tax fraud by diverting income and assets overseas and spending the money in the United States by using credit, charge or debit cards issued by banks in more than 30 countries, including Switzerland, Isle of Mann, Luxembourg, Liechtenstein, Singapore, Panama, Bermuda and numerous Caribbean nations. The summons approved by the court will seek information including names, addresses, social security numbers, and telephone numbers of the VISA cardholders.

"The IRS believes that people using offshore accounts are evading billions of dollars per year in United States taxes," said Eileen J. O'Connor, Assistant Attorney General for the Justice Department's Tax Division. "We are pleased with the court's order which enables us to find the taxpayers who maintain offshore accounts to evade taxes. We will use this information to enforce the tax laws."

In response to a similar suit filed in Miami, MasterCard has already produced over 1.7 million records, involving over 230,000 accounts, in response to a John Doe summons. American Express earlier this week agreed to turn over records relating to people who may be subject to United States income taxes and who have credit card accounts with addresses in Antigua and Barbuda, the Bahamas or the Cayman Islands. According to the IRS, that information will be used in civil audits and criminal investigations. The IRS estimates that the U.S. Treasury loses billions of dollars in annual tax revenue as a result of tax fraud committed by people with offshore bank accounts.

###

02-188