A campaign is building in the United States to defend Bradley
Birkenfeld, the former employee of Swiss bank UBS who has started
serving a 40-month prison term.
Birkenfeld blew the whistle on illegal
practices by UBS, in which the bank helped Americans avoid paying
taxes, but was himself sentenced after pleading guilty in 2008 to
conspiring to defraud the US by helping a billionaire hide $200 million
(SFr205.3 million) from tax authorities.
He cooperated with investigators seeking to find other wealthy Americans who used Swiss bank accounts to evade US taxes.
Birkenfeld’s
lawyer, Dean Zerbe, has called on President Barack Obama to review the
case. Zerbe is special counsel for the National Whistleblowers Center,
an organisation with a 20-year history of protecting the rights of
individuals who speak out about wrongdoing from retaliation.
swissinfo.ch: Bradley Birkenfeld, the man who offered the UBS
scandal to the US authorities on a plate, has been serving his sentence
since January 8. What is your reaction?
Dean Zerbe: It’s sad for him and his family
but it’s a tragedy for honest taxpayers who will have to pay higher
taxes; Bradley’s fate will discourage a whole generation of individuals
from blowing the whistle on tax fraud to the authorities.
swissinfo.ch: While recognising that Birkenfeld was a crucial
contributor in investigations into UBS, American justice authorities
considered him as a criminal and convicted him for not cooperating
enough against Igor Olenicoff, a former client of the Swiss bank... But
you almost make him a hero.
D.Z.: Bradley Birkenfeld is the embodiment of
what we call a whistleblower, the one who raises the alarm when he sees
wrongdoing at the workplace.
Birkenfeld first alerted his bosses
at UBS and then the bank’s ethics department. When he saw that there
were no actions being taken, he resigned. He contacted the US
Department of Justice. When he considered that it was not doing all it
could he informed the tax authorities, the Securities Exchange
Commission and the Senate.
As for Igor Olenicoff, Birkenfeld
spoke openly about him to the US authorities. To do this he needed a
subpoena to appear before the Senate so that he could be protected from
the Swiss authorities. As soon as the Senate issued the subpoena, he
cooperated. As a rule, whistleblowers are well treated by the American
authorities but this was not the case here.
swissinfo.ch: So can you explain how they are generally treated?
D.Z.: Not with a prison term! There are a
series of laws which protect them and compensate them for the risks
they take in uncovering the truth.
People who sound the alarm
bell on all kinds of fraud have allowed the US government to recuperate
billions of dollars, and those individuals receive a small part in
return. In this way, other employees are motivated to expose
malpractices in their companies or administrations.
swissinfo.ch: Is Birkenfeld considered a whistleblower by the Internal Revenue Service?
D.Z.: He asked for such a status and he comes
under that definition with the IRS. As such, he should be able to
receive compensation from the fine paid by UBS to the IRS. He should
also be able to claim money from the taxes that came to light to the
IRS from an estimated 14,000 UBS clients.
This compensation is
not limited to US citizens. The status of whistleblower can also be
claimed by Swiss, particularly those in the banking sector.
swissinfo.ch: Why is Bradley Birkenfeld in prison?
D.Z.: There is a particular Department of
Justice culture when it comes to tax fraud and this views informants
with suspicion, compared with other government organisations which work
with them all the time.
swissinfo.ch: Who else do you think ought to go to prison in the UBS affair?
D.Z.: Let me say first that it’s absurd and
scandalous that Bradley Birkenfeld, a man who has done so much to help
the American tax system, should be put behind bars for 40 months. Other
individuals dealt with by the justice authorities received much lower
penalties.
I don’t know who deserves to go to prison but the
American authorities would do well to pay particular attention to
individuals who hid in a UBS account money from an illegal activity
such as drug trafficking or those people who deliberately escaped the
tax authorities
swissinfo.ch: Martin Liechti, the former head of the wealth management business at UBS - should he go to prison?
D.Z.: Liechti was Birkenfeld’s boss’s boss.
He’s the kind of individual you have to talk to in such an inquiry. The
US government had him in their hands but let him off the hook. It’s
crazy because there are much bigger fish than Birkenfeld named and
Liechti certainly knows them.
swissinfo.ch: American analysts feel that Birkenfeld is a scapegoat
and that the authorities keep it that way so as not to cause any damage
to prominent politicians or others who were UBS clients. To what extent
do you agree with that analysis?
D.Z.: The celebrity of some UBS clients does
not prevent the IRS from investigating but you have first of all to
know the names of these people. But the agreement between the US and
Switzerland concerns a limited number of accounts and protects the
names of the holders.
swissinfo.ch: What is the petition that you are launching on behalf of Bradley Birkenfeld?
D.Z.: It’s a petition that members of the
public can sign online. It will go to President Barack Obama and his
attorney general, Eric Holder.
It asks them to order an
independent examination into Mr Birkenfeld’s case in the light of the
serious consequences that his prison sentence risks having on the fight
against corruption and against the secret and harmful practices of some
banks.
swissinfo.ch: Mr Holder worked at one time for UBS as a lawyer. Is that a problem?
D.Z.: No. Every lawyer has to work and have
clients. Having said that, the fact that he had ties to UBS increases
the need for total transparency in this case.
Marie-Christine Bonzom in Washington, swissinfo.ch (Adapted from French by Robert Brookes)
Jan 18, 2010 - 14:01
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