Swiss bank UBS has handed over records on a U.S. client's account in Singapore, as U.S. authorities seek to move beyond Switzerland in their fight against offshore tax evasion.
The case involves Ching-Ye «Henry» Hsiaw, a U.S. citizen living in China who had an account in Singapore from 2001 to 2011, as finews.asia reported earlier. After reaching an agreement with U.S. officials, the bank handed over records on May 31 and June 10, the Justice Department said Tuesday in a court filing dismissing the petition, «Reuters» and «Bloomberg» reported.
UBS has now complied with an IRS summons for bank records held by its Singapore office, the Justice Department announced late on Wednesday. Because UBS has now produced all Singapore-based records that the U.S. had requested and the IRS determined that UBS complied with the summons, the Justice Department has voluntarily dismissed its summons enforcement action against the bank.
Legal Tit-for-Tat
According to earlier reports, Hsiaw transferred funds from a Switzerland-based account with UBS to the Swiss bank's Singapore branch in 2002, according to the declaration of a revenue agent filed at the same time as the petition. UBS refused to produce the records, and the U.S. filed its petition to enforce the summons.
«The Department of Justice and the IRS are committed to making sure that offshore tax evasion is detected and dealt with appropriately,» said Caroline D. Ciraolo, acting assistant attorney general of the Justice Department's tax division.
U.S. Hints at Broader Powers
She hinted that U.S. officials would expand its legal toolkit to ensure that the IRS can get at offshore assets.
«In this case, we filed a petition to enforce a summons for offshore documents, but that’s only one of the tools we have available for gathering information,» Ciraolo said.
At the same time, she urged taxpayers with hidden offshore accounts to come clean, a method the U.S. has pursued very successfully to get at undeclared assets in Swiss accounts.
Who's Next?
The U.S. has focused largely on Switzerland since 2008 as it has fought offshore tax evasion. Swiss banks including Credit Suisse, UBS, and Julius Baer have agreed to pay billions in penalties and fees to U.S. officials for harboring untaxed assets in Switzerland, and the country has also largely abandoned its long-held secrecy laws.
The UBS data move begs the question of where the IRS and the Justice Department will turn to next, as they sift through a trove of data gathered from Swiss banks and from more than 50,000 U.S. taxpayers who disclosed their accounts to avoid prosecution.
