James F. McDonough
Of Counsel
732-568-8360 jmcdonough@sh-law.comFirm Insights
Oldest Swiss Bank to Close After Pleading Guilty to Helping U.S. Clients Evade Taxes
Author: James F. McDonough
Date: February 8, 2013
Key Contacts
Back
Wegelin and Co., the oldest bank in Switzerland, will soon shut its doors following a guilty admission for helping American clients evade U.S. tax law by hiding more than a billion dollars in income from the Internal Revenue Service.
Otto Bruderer, an official at the 270-year-old Swiss institution, entered the guilty plea on the bank’s behalf in a federal courtroom in Manhattan, New York. The bank was the first Swiss institution to be charged amid federal officials’ extensive investigations into offshore banking and tax law violations. The bank was found guilty of one count of conspiracy in which it helped more than 100 Americans hide more than $1.2 billion from the IRS. The bank entered into a plea agreement with U.S. federal officials which will require them to pay $20 million in restitution, $15.8 million for fees on undeclared accounts and $22 million in fines. The agreement between officials and the bank is pending court approval and sentencing is expected to take place on March 4.
Following the agreement, the financial institution said it “will cease to operate as a bank,” according to BBC News. The decision to close its doors and sell off assets was largely due to the criminal accusations and the bank’s desire to protect its non-U.S. clients.
In addition to pleading guilty to tax evasion, Bruderer allegedly admitted that while the practice of helping clients evade taxes was “wrong,” he noted that it’s a common practice in Switzerland, the BBC reports. In response, the Swiss banking community has expressed concern over the possibility that heavier investigations and penalties may be imposed on Swiss banks as the U.S. cracks down on tax evasion and offshore accounts.
“Some Swiss financial analysts are already speculating that Wegelin’s $58 million fine, which many had expected to be higher, was kept low by the U.S. authorities in return for Wegelin clearly implicating the rest of the Swiss banking community in tax evasion,” said BBC correspondent Imogen Foulkes.
- Practices: Tax and Trusts & Estates
- Locations: Red Bank, NJ, New York City, Little Falls, NJ
No Aspect of the advertisement has been approved by the Supreme Court. Results may vary depending on your particular facts and legal circumstances.
Related Posts
See all
A Whistleblower Just Filed a Complaint Against Your Company: Here's What to Do Now
Few situations create more uncertainty than learning that an employee has filed a whistleblower complaint. Questions arise immediately: Is the allegation legitimate? Should the employee be placed on leave? Do we need to notify our insurance carrier? Are we now prevented from disciplining the employee if there are unrelated ongoing work related issues? There is […]
Author: Sean M. Pena
Assignment for the Benefit of Creditors: An Alternative to Bankruptcy for Distressed Businesses
When a business reaches the point where it can no longer service its debts or otherwise resolve its liabilities, management is often faced with a difficult question: is a bankruptcy filing necessary or is there another way to perform an orderly liquidation or sale of the business assets? While Chapters 7 and 11 of the […]
Author: John D. Giampolo
Breaking Down New Jersey’s “Mansion” Tax: What Buyers and Sellers Need to Know
For many years, the New Jersey Mansion Tax has been a significant consideration in high-value real estate transactions. Recent legislative changes, however, have substantially altered how the tax operates, including who is responsible for paying it and the amount owed in certain transactions. Whether you are purchasing, selling, or investing in New Jersey real estate, […]
Author: George McGowan
Estate Planning for Digital Assets Under New Jersey Law
As our personal and financial lives increasingly move online, estate planning must evolve to address a new category of property: digital assets. From email accounts and social media profiles to cryptocurrency and cloud-stored business records, these assets often carry both financial and sentimental value. Yet, without proper planning, they can become inaccessible—or even lost—upon incapacity […]
Author: Marc J. Comer
The Role of Representation and Warranty Insurance in M&A Transactions
In today’s mergers and acquisitions market, representation and warranty (R&W) insurance has become a common feature of deal negotiations. Once used primarily in larger transactions, R&W insurance is now frequently incorporated into middle-market deals as buyers and sellers look for efficient ways to allocate risk and close deals. When structured properly, R&W insurance can help […]
Author: George McGowan
You Just Received a Federal Grand Jury Subpoena in New Jersey: Now What?
Receiving a federal grand jury subpoena is not something most businesses or individuals anticipate. While it can be concerning, a federal grand jury subpoena does not necessarily mean that you are being accused of wrongdoing. It does, however, mean that a federal criminal investigation is underway and that federal prosecutors believe you may possess information […]
Author: Sean M. Pena
No Aspect of the advertisement has been approved by the Supreme Court. Results may vary depending on your particular facts and legal circumstances.
Sign up to get the latest from our attorneys!
Explore What Matters Most to You.
Consider subscribing to our Firm Insights mailing list by clicking the button below so you can keep up to date with the firm`s latest articles covering various legal topics.
Stay informed and inspired with the latest updates, insights, and events from Scarinci Hollenbeck. Our resource library provides valuable content across a range of categories to keep you connected and ahead of the curve.