UBP To Pay US Authorities $187 Million In Tax Evasion Deal

Amisha Mehta Assistant Editor January 7, 2016

UBP To Pay US Authorities $187 Million In Tax Evasion Deal

The Swiss private bank has signed a non-prosecution agreement with the US Justice Department over secret accounts.

Union Bancaire Privée will pay a penalty of $187.767 million to avoid prosecution for helping clients evade US tax.

The non-prosecution agreement was reached under the US Department of Justice's Swiss Bank Program, which most recently saw the likes of Lombard Odier and DZ Privatbank (Schweiz) reach similar resolutions over tax evasion cases. These two Swiss banks paid a combined penalty of more than $107 million.

Under the deal, Geneva-headquartered UBP agrees to cooperate in any related criminal or civil proceedings and demonstrate its implementation of controls to stop misconduct involving undeclared US accounts.

The DoJ said that for decades prior to and through 2013, UBP helped US clients hide assets and income they held in undeclared accounts in Switzerland. Since August, 2008, the bank held and managed 2,919 US-related accounts, which included both declared and undeclared accounts, worth a total $4.895 billion in assets under management. Of these accounts, 1,282 were acquired through the acquisitions of other banks, including ABN AMRO, and bank assets.

Among other actions during this period, UBP held 502 US-related accounts in the names of non-US structures set up in jurisdictions such as the British Virgin Islands, the Cayman Islands, Liechtenstein and Panama. In addition, UBP employees helped numerous US clients conceal their undeclared account funds by making fictitious donations to other accounts at UBP. These were wholly or partly controlled by the US client but held by non-US persons.

“Today’s agreement marks the final resolution with UBP, which acknowledges its role in conspiring with US taxpayers to evade US tax through an array of sham entities, structured transactions, nominees and bank services designed to disguise the true ownership of foreign accounts and other assets,” said acting assistant attorney general Caroline Ciraolo of the Justice Department’s tax division. 

“Under the terms of the agreement, UBP pays a heavy price for its criminal conduct and must cooperate fully in all matters relating to the conduct described in the agreement until all civil or criminal examinations, investigations or proceedings are concluded.”

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