Federal authorities are going after not only banks, but also individual bankers and financial advisors who may have helped U.S. clients to evade their income tax obligations.  Just this past February, a superseding indictment was handed down against financial advisors who worked for Wegelin, one of Switzerland’s oldest banks. 

HSBC has been in trouble with the U.S. government in the past for the unlawful behavior of its private bank. In 2012, HSBC was fined for its role in facilitating money laundering.  Yahoo is now reporting on leaked documents from HSBC showing how involved the bank was not just in money laundering but also in helping people worldwide evade their income tax obligations.

Investors who used offshore accounts to hide money from the IRS are facing increased risks as the federal government launches new investigations into UBS and other offshore banks.  When banks and bankers make deals with the Department of Justice and with the Internal Revenue Service, these deals often involve turning over client information to the federal authorities.

U.S. citizens who have not filed an annual IRS Form 8983 and an annual Report of Foreign Bank and Financial Accounts (FBAR) may face criminal prosecution, as well as large civil fines. Participation in an Offshore Voluntary Disclosure Program (OVDP) can limit the fines and penalties. However, there is a list of “bad banks” and investors with those accounts may end up paying more.

From 2000 to 2008, CEO of Circle Net, Gregg Kaminsky, deposited money via wire transfer from two different U.S. companies into an account with Union Bank of Switzerland (UBS).  Kaminsky also moved money out of his Swiss account into other accounts that he had in Hong Kong and Thailand.