TNT Article Reporting on Panel at USD Law-Procopio Seminar (10/27/15)

Tax Notes Today has this article reporting on a panel discussion at the University of San Diego School of Law-Procopio International Tax Law Institute annual conference:  William Hoke, Focus Shifting Away from Switzerland, Former Investigators Say, 2015 TNT 207-7 (10/27/15) [No link available].  Key excerpts are:

[B]anks cooperating with the U.S. government turn over specific data, including details about the dates, amounts, and destinations of wire transfers that close out U.S. persons' accounts. While the account holders' names are not revealed, it is widely expected that the DOJ will use the detailed information on these so-called leaver lists to file group requests with the Swiss competent authority to obtain the identities of U.S. taxpayers who have not disclosed their account details. 

[Mark] Matthews [of Caplin & Drysdale] said a team will be looking to see if the U.S. has a tax treaty with the country where the funds transferred out of a Swiss account were sent. "They will now have the beginnings of the evidence to create a valid treaty request . . . and go after that same information in that other bank," he said, "so [the IRS has] put together a pretty neat little vice here." The message for individuals who think they're safe because they got their money out of Switzerland and into countries such as Panama is that "there's a very high chance they're going to find you," Matthews said. 

Banks that actively market themselves as discreet destinations for undeclared cash have cause for concern as well. "There's sort of a special place in hell in the Justice Department's mind for people who run and hide," Matthews said. "And the banks who took on people . . . who were running from Switzerland, the Department of Justice really finds that behavior offensive, both on the part of the banks and people who are running. That is a very dangerous thing to be doing these days." 

Steven Toscher, a criminal tax lawyer at Hochman, Salkin, Rettig, Toscher & Perez PC, said the government's strategy with the voluntary disclosure and Swiss bank programs is brilliant because of the magnitude of the problem and the scarcity of resources available to address it. "It's based on the presumption they can't prosecute everybody," Toscher said. "They just don't have the resources."

Other key points:

Another Sentence To Consider When Thinking of Sentencing Disparities

DOJ Tax CES touts this sentence on its web site here. The read on the site is short, so I encourage readers to look at it. Here's the guts of it though:

1. Plea to mortgage fraud (5 year count) with "total bank fraud loss, which included relevant conduct stemming from additional frauds that Shaffer perpetrated upon other banks, was $2,688,571.93."

2. Plea to tax evasion count (5 year count) with total tax loss (including relevant conduct for nonplea years, $536,228.77.

3. Plea to failure to collect, account for and pay over employment taxes (5 year count) with total tax loss, including relevant conduct, $272,209.14.

Sentence 51 months.

Compare this sentence with Mr. Thorson's. See here and here.

Sentencing Disparities

I just posted a discussion of the Thorson case here and earlier posted a discussion of the Quellos principals' sentencing here.  For conduct that does not appear dissimilar except that the Quellos' defendants conduct (including relevant conduct) involved far more tax loss, Thorson got 108 months and the Quellos defendants got 50 months.  And, one of the Quellos defendants, like Thorson, was an attorney who failed in his responsibilities as an attorney as fully as did Thorson.  Yet, the sentencing courts imposed incredibly disparate sentences.  While that is certainly possible in a post-Booker world, I am not sure it is to be lauded.  Which, if any of those sentences, are appropriate may depend upon the eye of the beholder, but it does seem to the eye of this beholder that there is some basic unfairness in the existence of that type of disparity.

Addendum 1/30/11 4:26pm:  Let me add this one also, where for a bogus tax shelter, the lawyer got 18 months in prison.  See DOJ Press Release of 1/28/11.