Susanne D. Rüegg Meier, a citizen and resident of Switzerland, pleaded guilty on July 19, 2017, to conspiring with U.S. taxpayers and other Swiss bankers to defraud the United States as the head of a team of bankers for Credit Suisse AG between 2002 and 2011. She was responsible for the accounts of over 1,000 clients and handled approximately $400 million in assets. Her conduct led to an estimated U.S. tax loss of between $3.5 and $9.5 million. Sentencing in this case is scheduled for early September 2017; Rüegg Meier faces a maximum of five years in prison, a period of supervised release, and restitution penalties.
The IRS released the full list of the top 12 tax scams threatening taxpayers and tax professionals in 2017, including:
California taxpayers beware! Willfully failing to file tax returns for three or more consecutive years is sufficient to determine the taxpayer intended to evade paying tax, and therefore may be prosecuted for felony tax evasion and punished by imprisonment not to exceed one year. Under federal law, an element of willfulness is required - that is, some other affirmative act such as hiding assets offshore, keeping a second set of books, or destroying records. According to California's 4th District Court of Appeal, the mere failure to file tax returns is sufficient under California Revenue and Taxation Code section 19706. We agree with the dissent and hope this case proceeds to the California Supreme Court.
Former intelligence agent Werner Mauss is the latest celebrity under scrutiny for allegedly evading taxes from profits on offshore accounts. Mr. Mauss says the accounts were opened by intelligence agencies to fund covert operations worldwide, including averting a mafia poisoning attempt against a Pope, and operations involving hostage releases. Mr. Mauss is a mystery. He has several aliases and is a self-proclaimed master spy. He is believed to have worked extensively under cover for Germany's BND intelligence service as well as for other governments. Mr. Mauss' lawyers identify the client confidences Mr. Mauss must maintain and other problems with standard litigation given the secret nature of Mr. Mauss' work and identity. For more information, click here.
Being accused of violating state or federal tax laws is a very stressful situation to be in. Not only are the consequences severe if you are found guilty, the state and federal tax systems are both extremely complex. This video explains what action a person should take immediately after being charged with tax crimes or being investigated for violating state or federal tax law.
According to IRS data, in fiscal year 2014, 120 employment tax cases were opened for tax evasion investigation. Of those, 92 were recommended for prosecution and 82 received federal sentences. These numbers are set to increase, not only in federal cases, but in California cases as well. Caroline Ciraolo, Acting Assistant Attorney General for the Department of Justice Tax Division, has indicated that increasing criminal enforcement for employment tax crimes is a priority of the DOJ Tax Division. The maximum sentence for the willful failure to meet payroll filing and payment obligations is 5 years with penalties as high as $200,000.
Once again, the Department of Justice has flexed its muscles and shown dishonest financial professionals that if they help clients hide assets offshore or create sham entities for clients to evade taxes, they will be prosecuted. The tax preparers in this case helped their wealthy clients to conceal millions of dollars of assets and income in secret foreign bank accounts, filed false federal income tax returns, maintained an offshore account in the name of a sham corporation and failed to disclose the account to the IRS. They also failed to file a Report of Foreign Bank and Financial Accounts (FBAR). Two of the three tax preparers have been sentenced to 36 and 50 months in prison and ordered to pay fines of nearly $300,000. The third tax preparer is still at large. To learn more, click here.
Gideon Misulovin, a former New York business man on trial for tax evasion and fraud in 1996, appeared in US federal court on July 17, 2015 for the first time in 19 years.
Each year, the Internal Revenue Service ("IRS") compiles an annual list of the common scams taxpayers may come across. Such scams tend to peak during filing season as taxpayers are preparing their own returns or hiring someone to prepare it for them. This year, in order to raise consumer awareness, the IRS is released one Dirty Dozen scam per day. Here are the final six scams about which the IRS is warning taxpayers:
After years of investigation by U.S. law enforcement authorities, and a plea of guilty for conspiracy, Credit Suisse AG was sentenced on November 21, 2014 for conspiracy to aid and assist U.S. taxpayers in filing false income tax returns and other documents with the IRS. Credit Suisse admitted to operating an illegal cross-border banking businesses purposefully assisting thousands of U.S. clients in opening and maintaining undeclared accounts and in concealing offshore assets and income from the IRS. Credit Suisse acknowledged doing this for decades prior to and through 2009. Credit Suisse will now provide a complete disclosure of its cross-border activities, including account information regarding clients and other banks with which it operated to maintain secrecy for clients from the United States.