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UBS’s Weil Not Guilty of Aiding Tax Evasion

November 5, 2014

Former UBS Wealth Management chief Raoul Weil has been acquitted by a federal court in Florida of “conspiring to help as many as 17,000 U.S. taxpayers hide $20 billion from the IRS,” reports Bloomberg.

The Swiss citizen’s legal team presented no defense. The jury, which had only the prosecution’s argument to consider, returned with a “not guilty” verdict after deliberating for about 90 minutes, says Bloomberg.

Weil, who once headed the world’s biggest private bank, is the best known “of three dozen foreign bankers, lawyers and advisers charged in a seven-year U.S. probe of offshore tax evasion,” writes the news service. UBS itself got around U.S. prosecution in 2009 when it paid a $780 million fine and admitted to helping clients evade U.S. taxes between 2000 and 2007.

Prosecutors said Weil was aware of “sham corporate structures” bankers under his supervision set up to mask the identities of U.S. clients from stateside authorities and knew of the “cloak-and-dagger methods” they used “to deliver them cash and account statements,” according to the report.

Nathan Hochman, former head of the U.S. Department of Justice’s tax division, now defends people charged with white-collar crimes. He tells Bloomberg the Weil verdict points to “the difficulty of going after senior management who can at times blame the bank’s customers and lower-level employees for the bank’s mistakes.” He adds it can be hard “to prove an historical case beyond a reasonable doubt when the government heavily relies on witnesses who have received very favorable treatment.”

Last week, a federal court in California acquitted Shokrollah Baravarian, an 82-year-old former executive of Israel-based Mizrahi Tefahot Bank, on charges he helped U.S. clients conceal assets from Uncle Sam.

Last year, when 79-year-old Mary Estelle Curran was found guilty of hiding inherited Swiss accounts worth $43 million, the judge sentenced her to a probation period of less than one minute — in fact, just five seconds. Then he excoriated prosecutors for picking on a homemaker whom he said had been led astray by advisors.

UBS had brought Curran — and about 4,500 other current and former clients — to the attention of U.S. authorities as part of its 2009 deal to avoid prosecution.

By Thomas Coyle
  • To read the Bloomberg article cited in this story, click here.