|Justice for Birkenfeld|
UBS Bank Insider Celebrated for Exposing $20 Billion Tax Evasion Scheme
$104 Million Paid to the Whistleblower
Washington, D.C. September 11, 2012 – The Internal Revenue Service (IRS) has awarded former UBS banker Bradley Birkenfeld a whistleblower reward of $104 Million for his contributions in providing the U.S. Government with insider information on UBS’ illegal offshore banking scheme. This is believed to be the largest reward ever given to an individual whistleblower in the United States and the first major reward issued under the IRS tax whistleblower law.
In a joint statement, Mr. Birkenfeld’s attorneys, Stephen M. Kohn and Dean A. Zerbe stated:
The IRS today sent 104 million messages to whistleblowers around the world – that there is now a safe and secure way to report tax fraud and that the IRS is now paying awards. The IRS also sent 104 million messages to banks around the world – stop enabling tax cheats or you will get caught.
In granting the award, the IRS described Mr. Birkenfeld’s contributions as follows:
Birkenfeld provided information on taxpayer behavior that the IRS had been unable to detect, provided exceptional cooperation identified [and] identified connections between parties to transactions . . . The comprehensive information provided by the whistleblower was exceptional in both its breadth and depth. While the IRS was aware of tax compliance issues related to secret bank accounts in Switzerland and elsewhere, the information provided by the whistleblower formed the basis for unprecedented actions against UBS.
A copy of the IRS Award Report is attached.
Stephen Kohn, who also serves as the Executive Director of the National Whistleblowers Center, stated that the NWC was initiating an international campaign to educate employees regarding their rights under new whistleblower reward laws covering tax evasion, securities fraud and violations of the Foreign Corrupt Practices Act: “Employees throughout the world need to know that there is a safe haven to blow the whistle on major frauds. As demonstrated by the IRS’ decision in the Birkenfeld case, these laws can be effectively used to combat corruption, illegal offshore tax evasion and money laundering,” Kohn said.
Mr. Birkenfeld's disclosures directly resulted in: a fine paid to the U.S. by UBS bank in the amount of $780,000,000.00; over 35,000 taxpayers participating in “amnesty” programs to voluntarily repatriate their illegal offshore accounts; and the collection of over $5 billion in back taxes, fines and penalties. Mr. Birkenfeld's disclosures also forced the Swiss government to change its tax treaty with the United States, resulting in UBS turning over the names of over 4,900 U.S. taxpayers who held illegal offshore accounts. These "taxpayers" are now being investigated and prosecuted.
Whistleblowers can visit www.whistleblowers.org to learn about their rights and to find out how they can report fraud confidentially.