Investigating & Recovering Hidden Money & Other Assets
This "Asset Search News Roundup" mentions the sentence of a former Louisiana congressman and the 14,700 U.S. taxpayers who sought partial amnesty from the IRS:
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My August 17th “Asset Search News Roundup” referred to the settlement of the case over the “John Doe” summons served on UBS in Miami. As more fully discussed at “UBS & Its John Doe Summons“, the IRS had brought the case to identify U.S. tax cheats who concealed their UBS bank accounts in…
U.S. taxpayers who beneficially own a foreign bank account with assets in excess of $10,000, are required to disclose the same at Schedule B, Part III of their U.S. Individual Tax Return Form 1040. These taxpayers must also separately file a TDF 90-22.1, (a.k.a. a “FBAR” form), the first page of which is shown here:…
“A Domestic Subpoena / Summons In An Offshore Asset Search” describes how the IRS and U.S. Department of Justice were granted court permission to serve a “John Doe” summons on UBS AG. This summons was supposed to help the IRS identify assets and / or undeclared revenue hidden by any U.S. taxpayers…
Today’s "Asset Search News Roundup" discusses yesterday’s arrest and indictment of Mr. Allen Stanford, who was the subject of my very last blog post. Just as Bernard Madoff was accused of money laundering, so is Mr. Stanford. Mr. Stanford has among other things, been indicted pursuant to 18 U.S.C. §1956 (h) (Conspiracy to commit…
Forced collection proceedings against a fraudster like Mr. Bernard Madoff can involve an extraordinary number of prospective plaintiffs with competing interests in the fraudster’s assets. In Mr. Madoff’s case, some of these plaintiffs competing over assets might even include foreign governmental authorities seeking asset forfeiture because of Mr. Madoff’s money laundering in the United Kingdom or perhaps elsewhere.
Another prospective plaintiff in Mr. Madoff’s case, is Irving H. Picard, Trustee for the liquidation of Mr. Madoff’s assets on behalf of thousands of victims, pursuant to the Securities Investor Protection Act and the Court’s Order. As "Madoff Trustee Seeks to Recover Assets in Gibraltar" reported, Mr. Picard just made a bankruptcy court filing seeking to retain special counsel to recover property in Gibraltar which belongs to Madoff.
Given all of the foregoing, I asked Swiss counsel to examine some of the complexities in pursuing forced collection proceedings against a fraudster like Mr. Madoff. My discussion with Swiss counsel was based on the hypothetical that someone similar to Mr. Madoff had hidden assets in banks in Switzerland. Swiss counsel’s comments are as follows:
"Complex forced collection proceedings may combine several competing recovery actions involving civil, criminal and administrative recovery remedies. To add to the complexity, these actions may be originated in various jurisdictions.
To take a concrete example, I am currently representing a client who was the victim of a fraud perpetrated in a far-eastern country. A criminal action against the perpetrator of the fraud was conducted in this country. The proceeds of the crime were transferred by the fraudster to the US where the fraudster managed to escape.
The fraudster was arrested at the request of the far-eastern country and sat in jail for three years for extradition purposes. Ultimately, he was extradited to that country and has now been sentenced to several years’ imprisonment.
The defrauded client chose to file a complaint for fraud, intentional misrepresentation, active concealment and several other counts including a RICO action against the fraudster in a Californian court.
The US attorney sought from a district court, an arrest warrant in rem of several assets in the US and also of funds deposited in a bank in Geneva.
Continue Reading Forced Collections Against A Fraudster Like Madoff
When assets are hidden in a foreign bank account or are otherwise offshore, domestic authorities might be able to seek asset forfeiture, discovery or other relief pursuant to a Mutual Legal Assistance Treaty (“MLAT”). Depending on the circumstances, MLAT’s can particularly help domestic authorities trying to locate, (and then possibly forfeit), criminal proceeds which have…
This week’s "Asset Search News Roundup" is about bank secrecy laws which can be exploited by tax cheats or other individuals fraudulently concealing their assets. As the OECD explained at page 19, ¶¶ 29 & 30 of "Improving Access To Bank Information For Tax Purposes", bank secrecy laws play a critically important role…
The Asia / Pacific Group on Money Laundering explains on its typologies webpage, that one way to hide assets is by purchasing portable valuable commodities like diamonds. The typologies webpage provides the example of a beneficial owner concealing assets by transferring diamonds to another jurisdiction. One man who may have tried this kind of…
This "Asset Search News Roundup" highlights shell companies which can be used to conceal bankruptcy estate, marital, probate or other assets. As "Bank Melli Accused Of Hiding Its Fifth Avenue Assets" mentions, the asset forfeiture case against New York’s ASSA CORP. is perhaps a good example of a domestic shell company suspected…
