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Top UBS Executive Indicted In Florida
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UBS, which has extensive legitimate operations in the United States, has been the focus of investigations by the Justice Department, the IRS and the Securities and Exchange Commission.
The government has been pressing the Swiss to turn over the names of an estimated 19,000 Americans who hold accounts with UBS in Switzerland that have not been declared to the U.S. government. Failing to disclose the accounts can be a federal crime, as can failing to pay taxes on income earned by the accounts.
"Every American who pays his or her taxes should be offended that a select few use anonymous offshore accounts to avoid paying their fair share," R. Alexander Acosta, the U.S. attorney for the Southern District of Florida, said in a news release yesterday.
UBS recently gave the IRS, the Justice Department and the Manhattan district attorney's office the names of about 70 American clients who have accounts with UBS in Switzerland and have not filled out so-called W-9 forms authorizing UBS to disclose information about their accounts to the IRS, a source with access to information about the matter said.
The information UBS provided on those clients related to wire transfers from their UBS accounts in the United States to their UBS accounts in Switzerland, the source said. The clients were not given a chance to object to the disclosure -- a right they would have had if the information were coming from Switzerland, the source said. The source spoke on condition of anonymity to avoid potentially adverse consequences of speaking openly.
Asked for comment on the disclosures, a UBS spokesman drew a distinction between information stored in the United States and information kept in Switzerland. "Client data located in Switzerland has not been provided to the U.S. authorities," bank spokesman Michael Willi said.
The disclosure of the money transfers contrasts with assurances UBS gave clients several years ago, when some feared UBS's acquisition of the Paine Webber brokerage firm in the United States would make it more vulnerable to pressure from the U.S. government.
"We are writing to reassure you that your fear is unjustified and wish to outline only some of the reasons why the protection of client data can not possibly be compromised upon," bank executives wrote in a Nov. 4, 2002, "Dear client" letter. Even if a client refused to sign a W-9 form, the executives wrote, "under no circumstances will his/her identity be revealed."
Staff researcher Julie Tate contributed to this report.
