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Berner Kantonalbank AG Enters Into Non-Prosecution Agreement

Posted in Offshore Account Update on September 25, 2015 | Share

Berner Kantonalbank AG has entered into a non-prosecution agreement. The Department of Justice has agreed not to prosecute Berner Kantonalbank AG for tax-related offenses under Titles 18 and 26 of the United States Code or for monetary transaction offenses under Sections 5314 and 5322 of Title 31 of the U.S. Code. In exchange for not being prosecuted by the DOJ, Berner Kantonalbank AG has agreed to provide detailed information on U.S.-affiliated accounts.

Berner Kantonalbank AG is not the first bank to enter into a non-prosecution agreement. The Swiss Bank Program, established by the Department of Justice, creates a process for banks to voluntarily come forward and admit their part in facilitating tax evasion or helping U.S. accountholders to evade their IRS reporting requirements.

The Swiss Bank Program means everyone with offshore funds who has not declared them is at risk of having their bank offer information on their accounts to the DOJ and IRS. A Washington DC criminal tax attorney can provide assistance with amnesty programs, including the Swiss Bank Program and the Offshore Voluntary Disclosure Program (OVDP), that make it possible to avoid criminal consequences for noncompliance with U.S. tax laws.

Non-Prosecution Agreement Means Trouble for Accountholders

Berner Kantonalbank AG has agreed to pay approximately $4.16 million in penalties to the Department of Justice in lieu of other criminal fines, forfeiture or restitution. The bank has voluntarily disclosed its cross-border activities and has provided DOJ with the names and functions of the individuals who structured, operated or supervised cross-border activities for U.S. related accounts. Berner Kantonalbank AG will be cooperating with the Tax Division, including providing information about internal investigations to tax authorities.

Detailed account information about U.S.-affiliated accounts has already been provided and more information will be offered by Berner Kantonalbank AG to U.S. authorities. Berner Kantonalbank AG and other banks participating in the Swiss Bank Program must offer information on the number of U.S. accounts, the maximum dollar values of each account, the number of U.S. individuals and entities potentially affiliated with each account and the nature of the relationship each U.S.-affiliated person had with each of the offshore accounts.

Berner Kantonalbank AG will need to cooperate fully with the IRS, the Department of Justice and any other federal law enforcement agencies designated by the DOJ. The bank will also close accounts of U.S. accountholders who have not complied with all of their reporting requirements.

When banks like Berner Kantonalbank AG enter the Swiss Bank program, they all agree to substantially similar terms as part of their non-prosecution agreement (but the fines paid differ based on the specific actions of each institution). This means that turning over accountholder information is always a part of the deal when banks want to avoid prosecution.

Accountholders who have their details provided to DOJ and IRS are going to be unable to participate in the Offshore Voluntary Disclosure Program once authorities begin investigating them for failure to report offshore funds.

As more and more banks reach agreements, more accountholders are going to find themselves closed out of tax amnesty programs and facing very serious potential consequences. Now is the time for anyone with offshore accounts to speak with criminal tax attorney Kevin Thorn about how they can protect themselves.


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