UBS whistleblower gets $104M from IRS
Bradley Birkenfeld served 2.5 years in jail, but got paid for his help Tuesday
The Associated Press
Posted: Sep 11, 2012 12:39 PM ET
Last Updated: Sep 11, 2012 1:18 PM ET
Former UBS employee Bradley Birkenfeld, shown in a handout photo released by the National Whistleblowers Center, has been awarded $104 million US for providing information about overseas tax cheats. (National Whistleblowers Center/Associated Press)
The U.S. Internal Revenue Service has awarded a former Swiss banker $104 million US for providing information about overseas tax cheats — the largest amount ever awarded by the agency, lawyers for the whistleblower announced Tuesday.
Bradley Birkenfeld is credited with exposing widespread tax evasion at Swiss bank UBS AG.
Birkenfeld himself served roughly two and-a-half years in prison for a fraud conspiracy conviction related to the case, which resulted in a $780 million fine against the bank and an unprecedented agreement requiring UBS to turn over thousands of names of suspected American tax dodgers to the IRS.
He was released from prison Aug. 1.
"The IRS today sent 104 million messages to whistleblowers around the world — that there is now a safe and secure way to report tax fraud and that the IRS is now paying awards," Birkenfeld's lawyers, Stephen M. Kohn and Dean A. Zerbe, said in a statement.
"The IRS also sent 104 million messages to banks around the world — stop enabling tax cheats or you will get caught."
The Canada Revenue Agency is also investigating how much undeclared income is being held in offshore bank accounts by those who owe on Canadian taxes.
Two years ago, a joint CBC News/Globe and Mail investigation revealed that more than 1,700 such accounts belonging to Canadians had turned up on a list of secret accounts in Switzerland.
Prime Minister Stephen Harper insisted tax evaders would be prosecuted.
"If some citizens use Swiss bank accounts to avoid paying lawful taxes, the government will prosecute them to the full extent of the law," he said in the House of Commons on Sept. 30, 2010.
Law seen as powerful tool
"The IRS believes that the whistleblower statute provides a valuable tool to combat tax non-compliance, and this award reflects our commitment to the law," IRS spokeswoman Michele Eldridge said in an email.
Birkenfeld has become something of a cause celebre among whistleblowers because of the magnitude of his case and the fact that he was jailed after cooperating with authorities. In a summary of the award provided by Birkenfeld's lawyers, the IRS said, "The comprehensive information provided by the whistleblower was exceptional in both its breadth and depth."
Federal prosecutors, however, had said Birkenfeld withheld information about his own dealings with a former UBS client who pleaded guilty in 2007 to tax charges.
With files from CBC NewsShare Tools
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