Massachusetts Man Sentenced In Manhattan Federal Court For Hiding Millions From Irs In Swiss Bank Accounts
Preet Bharara, the United States Attorney for the Southern District of New York, announced that JACQUES WAJSFELNER was sentenced today to six months of probation, including three months of home confinement, for willfully failing to file Reports of Foreign Bank and Financial Accounts (“FBARs”) with the IRS, regarding Swiss bank accounts that he maintained and controlled. WAJSFELNER used the services of Beda Singenberger, a Swiss financial adviser who was charged in July 2011 with conspiring with various U.S. taxpayers and others to hide more than $184 million offshore at various Swiss banks. WAJSFELNER also had undeclared accounts at Wegelin & Co., a Swiss bank sentenced yesterday for conspiring to evade taxes, file false tax returns, and defraud the IRS in the Southern District of New York, and Credit Suisse. As part of his resolution of the criminal charges against him, WAJSFELNER agreed to pay a civil penalty of over $2.8 million, representing 50% of the high value of the accounts that he maintained. Today’s sentence was imposed by U.S. District Judge Naomi Reice Buchwald.
According to the Information filed in Manhattan federal court, other court documents, and statements made in connection with WAJSFELNER’s guilty plea and sentencing:
Under federal law, when filing Individual Income Tax Returns, form 1040, U.S. taxpayers are required to report their worldwide income. Taxpayers who have a financial interest in, or signature or other authority over, a bank account in a foreign country with an aggregate value of more than $10,000 at any time during a particular year, are required to file FBARs every year for each qualifying account. The FBAR requires the disclosure of the financial institution where the account is held, the type of account, the account number, and the maximum value of the account during the calendar year for which it is being filed.
Beginning in 1995, WAJSFELNER held an account in his own name at Credit Suisse, a Swiss bank with its headquarters in Zurich, Switzerland. In June 2006, with the assistance of Singenberger, WAJSFELNER opened an undeclared account at Credit Suisse in the name of a sham corporation formed under the laws of Hong Kong, Ample Lion Ltd. (“Ample Lion”). By opening the Ample Lion account at Credit Suisse, WAJSFELNER was attempting to obscure his ownership of the assets in the account from the IRS. As of December 31, 2007, WAJSFELNER’s account at Credit Suisse in the name of Ample Lion held assets valued at nearly $5.7 million.
In the fall of 2008, Credit Suisse began the process of exiting its U.S. cross-border banking business. In order to continue hiding money in Switzerland, in June 2009, WAJSFELNER opened an undeclared account at Wegelin. With Singenberger’s assistance, WAJSFELNER then transferred the assets from his account at Credit Suisse into his account at Wegelin. As of December 31, 2010, WAJSFELNER’s account at Wegelin held assets valued at nearly $5.5 million.
For each of the calendar years from 1995 through 2011, WAJSFELNER failed to file an FBAR with the IRS disclosing his authority over his accounts at the Credit Suisse and at Wegelin. His tax returns for the years 2005 through 2011 were similarly false in omitting the information about his Swiss bank accounts. WAJSFELNER’s sentencing is the latest in a series of prosecutions in the Southern District of New York of U.S. taxpayers who held undeclared accounts in Switzerland at UBS, Wegelin, Credit Suisse, and/or other Swiss banks, and who failed to make timely voluntary disclosures to the IRS as part of the IRS’s Voluntary Disclosure Program.
In addition to his probation, WAJSFELNER, 83, of Weston, Massachusetts, was also ordered to pay back taxes of $419,940 and a fine of $20,000.
The case against Singenberger is pending. The charge and allegations against him are merely accusations, and he is presumed innocent unless and until proven guilty.
Wegelin was sentenced yesterday and ordered to pay approximately $58 million to the United States. Together with the April 2012 forfeiture of more than $16.2 million from Wegelin’s U.S. correspondent bank account, this amounts to a total recovery to the United States of approximately $74 million.
Mr. Bharara praised the outstanding efforts of IRS-CI in the investigation, which he noted is ongoing. Mr. Bharara also thanked U.S. Department of Justice’s Tax Division for their assistance in the investigation.
This case is being handled by the Office’s Complex Frauds Unit. Assistant U.S. Attorneys Daniel W. Levy, Jason H. Cowley, and David B. Massey are in charge of the prosecution.