FBAR Collection Suit for over $105 Million (8/20/19)

A fellow practitioner alerted me to the FBAR collection suit in United States v. Burga (N.D. Cal. No. 19-cv-03246.)  The Court Listener docket entries are here.  As of this writing, the docket entries (through 8/2/19) show routine entries other than the complaint.  The complaint (from Court Listener) is here.

Note on access to court listener documents, see the last paragraph of this blog.

The complaint is against Francis Burga and her deceased husband (with Francis serving as administrator).  The willful FBAR penalties are $52,581,605 against each, husband and wife, and thus aggregate $105,163,210.  There are also late payment penalty, fees and interest on the base FBAR penalties.

The complaint is pretty damning.  Here are some items in the complaint:

1.  The defendants had "financial interest in at least 294 foreign bank accounts, in various countries, during at least years 2004 through 2009." (Compl. par. 12, which lists the accounts from p. 3 to p. 11.)

2.  The defendants created a Liechtenstein foundation that established complex structures of entities, numbering at least 25, based in Liechtenstein, Switzerland, Singapore and other European and Asian countries.  (Compl. par. 33-35.)

3.  The defendants signed documents with UBS indicating that they were U.S. citizens subject to U.S. tax and directing that statements not be sent to them and that the account not invest in U.S. securities (which would have triggered a U.S. information reporting by UBS).  (Compl. pars. 39-41,)

4.  During an audit in 2007 (apparently August 7, 2007), Mr. Burga told the IRS Revenue Agent conducting the interview that he and Ms. Burga did not have any foreign bank accounts, foreign corporations or foreign trusts.  (Compl. par. 44.)

5.  Immediately after the IRS interview, Mr. Burga moved all of the funds (over $6 million) from the UBS account and into a Liectenstein stiftung, for which Mr. Burga was founder and owner.  (Compl. pars. 45 & 46.)

6.  "Mrs. Burga has admitted that Mr.Burga is liable for the civil FBAR penalties assessed."  (Compl. par. 55.)

7.  The complaint does not have a spreadsheet with the amounts of the willful FBAR penalty for each account per year.

There is a related summons enforcement suit filed in 2018, styled United States v. Burga (N.D. Cal. 18-cv-01633), here on Court Listener.

The two interesting items from the documents available on Court Listener are:

• Hearing transcript dated May 17, 2019, here.
• Order dated August 16, 2019, here.

COURT LISTENER WEB SITE

The Court Listener web site is a free web site (may require signing up) that, inter alia, provides the docket entries and, for some of the docket entries, the documents that were filed.  As I understand the process:

1.  Each time a user with the Court Listener browser extension (my browser is Google Chrome where I installed the Court Listener browser extension) reviews the docket entries in Pacer, the docket entries on Court Listener site are updated.  So, for a case that gets regular Pacer activity, it is likely that the Court Listener will have reasonably current docket entries and access to some of the documents.

2  Each time a user clicks on the docket entry in Pacer to review or download the document, a copy is available on the court listener docket entries so that Court Listener users can then download the documents free on Court Listener.

3.  If the docket entries or documents are available on Court Listener, the web browser extension will notify when on Pacer whether the Court Listener docket entries or documents are available there, so that users can avoid Pacer fees.

I tend to look at docket entries on Pacer and will go to Court Listener when the Court Listener plug in tells me the docket entries or documents are available on Pacer.  If they are not, I will look at the docket entries and some documents on Pacer, thereby making my contributions for others to have free access via Court Listener.  But, many times I find that some other user has already done that and I can obtain those free on Court Listener.  So, I recommend to others that they sign up with Court Listener.