- The Washington Times - Wednesday, August 19, 2009

NEW YORK | More than 150 UBS clients in the United States are under investigation for concealing income and assets offshore at the bank, a prosecutor said in a court filing.

The scope of the investigation was disclosed Tuesday in a memo recommending that former UBS banker Bradley Birkenfeld serve 30 months in prison for conspiring to help wealthy Americans evade taxes. Birkenfeld, who faces up to five years in prison, will be sentenced Friday in Fort Lauderdale, Fla.

Birkenfeld, 44, pleaded guilty in June 2008 to conspiracy, saying he helped U.S. clients evade taxes through Zurich-based UBS. He is seeking leniency for helping a worldwide tax-fraud probe. UBS agreed Feb. 18 to pay $780 million to avoid prosecution for helping wealthy Americans evade taxes. The bank gave account data on 250 clients to the Internal Revenue Service.

“Ultimately, based upon information obtained from UBS as part of the deferred-prosecution agreement, the United States is criminally investigating more than 150 Americans across the country who are believed to have concealed income and assets at UBS in violation of United States law,” acting U.S. Attorney Jeffrey Sloman said in the filing.

Three UBS clients pleaded guilty since the agreement to filing false tax returns, and a fourth was charged last week with failing to file a tax report for an offshore account.

“Birkenfeld has provided substantial assistance in the investigation and prosecution of others who have committed offenses,” Mr. Sloman wrote. “This substantial assistance has been timely, significant, useful, truthful, complete and reliable.”

On Feb. 19, the IRS sued UBS in federal court in Miami, seeking the names of Americans suspected of evading taxes through 52,000 secret Swiss accounts. On Aug. 12, a Justice Department lawyer told the judge in the case that the two sides had reached a settlement.

Birkenfeld has given information to the IRS, U.S. prosecutors, the Securities and Exchange Commission, Senate investigators and foreign countries “investigating, among other things, UBS’s conduct in those countries,” according to the memo.

Birkenfeld, calling his cooperation “extraordinary,” said he should be sentenced to five years’ probation, according to court papers the former banker filed Tuesday. Birkenfeld is under house arrest with electronic monitoring near Boston.

The February settlement and prosecutors’ efforts seeking the names of secret Swiss bank account holders would not have occurred without Birkenfeld’s cooperation, he said.

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