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Offshore Tax Crimes Scorecard: Bankers, Clients at UBS

(Corrects 31st paragraph of story published Dec. 15 to say Goldstein has not entered a plea.)

The U.S. extended its crackdown on offshore tax evasion, charging former UBS AG (UBSN) banker Renzo Gadola with helping American clients hide assets from the Internal Revenue Service by shifting them to a smaller Swiss bank.

Gadola, 44, was accused yesterday of conspiring with a Swiss banker to encourage U.S. clients who hadn’t told the IRS about their UBS accounts to open undeclared accounts at Basler Kantonalbank. Gadola and the banker told clients not to join a voluntary disclosure program that led 18,000 Americans to declare offshore accounts to the IRS, prosecutors said.

The crackdown has led to criminal charges against UBS, the largest Swiss bank, two dozen former clients, four former bankers and two advisers. A former client of HSBC Plc, Europe’s biggest bank, also has been charged, as well as a Swiss lawyer who helped him.

Below is a summary of the charges involving UBS, filed in federal courts around the U.S.:

UBS: The Zurich-based bank agreed in February 2009 to pay $780 million to defer prosecution for aiding tax evasion by U.S. clients. The bank said its Swiss private bankers helped wealthy Americans evade U.S. taxes from 2000 to 2007. UBS also set up sham offshore companies in tax havens such as the British Virgin Islands, Hong Kong and Panama. UBS said it created misleading forms saying those sham companies, not taxpayers, were the beneficial owners.

Bradley Birkenfeld: A former UBS banker, he pleaded guilty to helping wealthy Americans, including billionaire Igor Olenicoff, evade taxes. He cooperated with prosecutors. In August 2009, he was sentenced in Fort Lauderdale, Florida, to 40 months in prison, 10 months more than prosecutors had requested. He has asked President Obama to reduce his sentence, saying he was treated unfairly as a whistleblower.

Raoul Weil: A former chief executive officer of global wealth management at UBS, he was indicted in November 2008 in Fort Lauderdale on a charge of helping wealthy Americans hide assets from the IRS. He was declared a fugitive in January 2009.

Hansruedi Schumacher: A former Neue Zuercher Bank manager who once ran the cross-border business for UBS, Schumacher was indicted in August 2009 in Fort Lauderdale on a charge of helping U.S. citizens evade taxes on UBS and NZB accounts. He was declared a fugitive in December 2009.

Matthias Rickenbach: A Zurich lawyer, Rickenbach was indicted with Schumacher in August 2009 on a charge of helping Americans evade taxes on UBS and NZB accounts. He was declared a fugitive in December 2009.

Mario Staggl: A Liechtenstein investment adviser at New Haven Trust Co., Staggl was indicted with Birkenfeld in April 2008 on a charge of helping wealthy Americans evade taxes. He was declared a fugitive in May 2008.

Igor Olenicoff: A billionaire real-estate developer, Olenicoff pleaded guilty in December 2007 in Santa Ana, California, to filing a false tax return. He failed to declare accounts at UBS, where he once had $200 million. He received two years’ probation and paid $52 million in back taxes, interest and penalties.

Jules Robbins: A retired watch distributer from Jericho, New York, Robbins pleaded guilty in April 2010 in New York, admitting he failed to declare a UBS account that held $42 million in 2007. He was sentenced in September 2010 to one year of probation. He paid a $20.8 million civil penalty and a $2,000 fine.

Federico Hernandez: A financial adviser who ran 2020 Emerging Inc., Hernandez pleaded guilty in April 2010 in New York. He admitted setting up sham accounts in the British Virgin Islands and Panama to hide his UBS accounts worth $8.8 million in 2006. He was sentenced in September 2010 to one year in prison, fined $4,000 and ordered to pay $84,423 in restitution to the IRS. He agreed to pay a civil penalty of $4.4 million. He also pleaded guilty in state Supreme Court in New York and was fined $25,000.

Jack Barouh: The former owner of a watch company sold to Fossil Inc. for about $50 million, Barouh pleaded guilty in February 2010 to failing to disclose about $10 million in offshore assets. He was sentenced in Miami in April 2010 to 10 months in prison and fined $5,000.

Kenneth Heller: A disbarred New York maritime attorney, Heller opened a UBS account in 2006 with $26.4 million, prosecutors charged in April 2010. Heller later transferred $20 million to a smaller private Swiss bank, prosecutors said. Heller, who was charged with tax evasion and failing to file a Report of Foreign Bank and Financial Accounts, or FBAR, was arrested in Hoboken, New Jersey. He was indicted in May 2010.

Sybil Nancy Upham: A New York resident, Upham was indicted in April 2010 in New York on charges of conspiracy, filing false tax returns and failing to file FBARs. Upham was charged with hiding UBS accounts worth $11.3 million in 2007 and later moving $8.5 million to a small Liechtenstein bank. She pleaded guilty in November 2010. She awaits sentencing.

Samuel Phineas Upham: The son of Sybil Nancy Upham, he was indicted in December 2010 on charges that he helped his mother hide more than $11 million through overseas accounts.

Harry Abrahamsen: A New Jersey businessman, he pleaded guilty in April 2010 in Newark, New Jersey, to failing to tell U.S. authorities about almost $800,000 in offshore accounts. He awaits sentencing.

Lucille Abrahamsen Jackson: The daughter of Harry Abrahamsen, she pleaded guilty in Newark in November 2010 to failing to tell U.S. authorities about an account valued at $759,376 in 2003. She awaits sentencing.

Steven Michael Rubinstein: A Florida accountant who worked at an international yacht company, he pleaded guilty in June 2009 to filing a tax return that failed to disclose secret UBS accounts that held at least $7 million. A judge in Miami sentenced him in October 2009 to 12 months of home detention.

Robert Moran: A Florida yacht broker who pleaded guilty in Fort Lauderdale in April 2009 to filing a tax return that failed to disclose $3.4 million held at UBS. He was sentenced in November 2009 to two months in prison and five months of home detention.

Jeffrey Chernick: A New York toy salesman who pleaded guilty in July 2009 to filing a false tax return that concealed $8 million at UBS. In his plea, Chernick implicated four others in detailing a $45,000 bribe paid to a Swiss government official. In October 2009, he was sentenced in Fort Lauderdale to three months in prison. The judge later reduced Chernick’s term to one month.

Juergen Homann: A New Jersey businessman who admitted in September 2009 in Newark that he didn’t report $6.1 million in UBS assets to the U.S. government. He was sentenced in January 2010 to five years’ probation and fined $60,000.

John McCarthy: A California businessman who pleaded guilty in Los Angeles in October 2009 to failing to file a tax report for an offshore bank account holding more than $1 million. He was sentenced in March 2010 to six months of home detention, with 300 hours of community service and a $25,000 fine.

Roberto Cittadini: A former sales manager at Boeing Co., the resident of Bellevue, Washington, pleaded guilty in October 2009 to filing a false tax return that hid income on $1.86 million in assets. He was sentenced in Seattle in January 2010 to one year of probation, including six months of home detention, and 200 hours of community service. He also was fined $10,000 and ordered to pay $17,985 in restitution.

Richard Werdiger: A resident of Purchase, New York, Werdiger was indicted in April 2010 on charges of conspiracy, filing false tax returns and failing to file FBARs. Werdiger, who sold diamonds and jewelry through companies including Michael Werdiger Inc., opened three UBS accounts through sham entities in Panama and Liechtenstein and communicated with the bank through the code name “Trygon,” prosecutors said. By 2003, his accounts totaled $7 million, according to the government. His case is pending.

Ernest Vogliano: A New York resident, Vogliano opened UBS accounts through shell corporations in Liechtenstein and Hong Kong that were valued at $4.9 million in 2000, prosecutors said. After 2008, he withdrew hundreds of thousands of dollars through traveler’s checks, prosecutors said. Vogliano was indicted in April 2010 in New York. His case is pending.

Shmuel Sternfeld: A resident of Tel Aviv, Sternfeld opened a UBS account in 2004 in the name of a Hong Kong shell corporation, prosecutors said. Sternfeld transferred money to buy a condominium in Florida and later moved funds to an account in the Czech Republic, prosecutors said. His account was valued at $2.9 million in 2005. Sternfeld was indicted in April 2010 in New York. His case is pending.

Leonid Zaltsberg: A former soccer player on the Soviet national team, he pleaded guilty in July 2010 in Newark to failing to tell U.S. authorities about $2.6 million in an offshore account. He awaits sentencing.

Paul Zabczuk: A resident of The Woodlands, Texas, Zabczuk pleaded guilty in Fort Lauderdale in April 2010 to charges that he filed a false tax return and didn’t disclose his UBS account. He was sentenced in July 2010 to one year of home detention and fined $25,000.

Bernard Goldstein: A resident of Carlsbad, California, who exports oil pipeline products to Russia, he was indicted in November 2010 on charges of conspiracy, filing false tax returns and failing to file FBARs. Prosecutors said his account held more than $2.5 million in 2003. He has not entered a plea in federal court in San Diego, court records show.

Gregory Rudolph: A resident of Brookline, Massachusetts, he was charged in October 2010 with failing to file FBARs on an account that held at least $1.5 million. He has agreed to plead guilty in Boston, court records show.

Peter Schober: A Boston resident in the investment management business, he was charged in October 2010 with failing to file FBARs on an account that held at least $1 million. He pleaded guilty in November 2010 in Boston, court records show.

Jeffrey Chatfield: A California consultant who advised private companies seeking to go public, he pleaded guilty in November 2010 to failing to declare an account that once had a balance of about $900,000. He awaits sentencing in San Diego.

Andrew Silva: A Virginia surgeon, he pleaded guilty in February 2010 to conspiring with an HSBC banker and a Zurich attorney to hide a $250,000 account from the IRS by smuggling 26 cash payments to the U.S. Silva was sentenced in Alexandria, Virginia, in June 2010 to four months of home detention, fined $20,000, forfeited $211,200 and paid $16,484 in back taxes.

Felix Mathis: A Swiss lawyer, he was indicted in July 2010 on charges that he helping Silva hide assets from the IRS and smuggle $235,000 into the U.S. The case is pending in Alexandria.

To contact the reporter on this story: David Voreacos in Newark, New Jersey, at dvoreacos@bloomberg.net.

To contact the editor responsible for this story: David E. Rovella at drovella@bloomberg.net

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