The Department of Justice has signed an addendum to a non-prosecution agreement with Bank Lombard Odier, of Zurich Switzerland. The original NPA was signed on Dec. 31, 2015.
The Swiss Bank Program, which was announced in August 2013, provided a path for Swiss banks to resolve potential criminal liabilities in the United States relating to offshore banking services provided to United States taxpayers. Swiss banks eligible to enter the program were required to advise the Justice Department by December 2013 that they had reason to believe that they had committed tax-related criminal offenses in connection with undeclared U.S.-related accounts.
Swiss banks participating in the program were required to make a complete disclosure of their cross-border activities, provide detailed information on an account-by-account basis for accounts in which U.S. taxpayers had a direct or indirect interest, cooperate in treaty requests for account information, and provide detailed information about the transfer of funds into and out of U.S.-related accounts, including undeclared accounts, that identify the sending and receiving banks involved in the transactions.
The Justice Department executed NPAs with 80 banks between March 2015 and January 2016. It imposed a total of more than $1.36 billion in Swiss Bank Program penalties, including more than $99 million in penalties from Lombard Odier. Under the addendum to Lombard Odier’s NPA, Lombard Odier will pay to the Justice Department an additional sum of $5.3 million and will provide to the Department supplemental information regarding its U.S.-related account population, which now includes 88 additional accounts.
Every bank that signed an NPA in the Swiss Bank Program had represented that it had disclosed all of its U.S.-related accounts that were open at each bank between Aug. 1, 2008, and Dec. 31, 2014, the Justice Department said. Each bank also represented that it would, during the term of the NPA, continue to disclose all material information relating to its U.S.-related accounts.
In reaching its agreement, Lombard Odier acknowledges that there were certain additional U.S.-related accounts that it knew about, or should have known about, but that were not disclosed to the Department at the time of the signing of the NPA. Lombard Odier provided early self-disclosure of their unreported U.S.-related accounts and has fully cooperated with the Department.
“The Department of Justice and Internal Revenue Service have capitalized on information obtained under the Swiss Bank Program to analyze the flow of money of U.S. tax evaders from closed Swiss bank accounts to banks in other countries. As a result, the Department has learned more about the methods of those who continue to evade their tax obligations and those institutions that assist them,” said Richard Zuckerman, principal deputy assistant attorney general of the Department of Justice’s Tax Division. “I urge any banks that aided and abetted in these schemes, or that have received money from closed Swiss bank accounts owned or controlled by persons or entities that are U.S. related, to contact the Tax Division and disclose complete and accurate information about these activities before they are contacted by the Division or the IRS.”