Bloomberg: Bank Leumi to Pay $400MM in U.S. Tax Probes
Bloomberg reported Bank Leumi Le-Israel agreed to pay $400 million and admit it helped American clients evade taxes for a decade, in a case showing that U.S. prosecutors and New York regulators are extending their probes of offshore tax evasion beyond Switzerland.
According to Bloomberg, The Justice Department filed a conspiracy charge against Bank Leumi, Israel’s second-largest lender, and four units. The U.S. agreed to defer prosecution for two years, and the bank admitted it unlawfully helped clients hide assets from the Internal Revenue Service, according to court documents.
Bloomberg reported the company will pay $130 million to New York’s Department of Financial Services, fire the head of its trust subsidiary and improve its compliance program. The accord is part of a seven-year U.S. probe of offshore tax evasion that has predominantly focused on Switzerland, according to Bloomberg.
“Bank Leumi knowingly opened and maintained undeclared accounts that aided and assisted U.S. taxpayers in concealing their offshore assets and income from U.S. taxing authorities,” the Tel Aviv-based bank said in a 20-page statement of facts filed in Los Angeles federal court.
Bloomberg reported the U.S. probe has already led to charges against UBS Group AG, the largest Swiss bank; guilty pleas by Credit Suisse Group AG (CSGN)’s main bank subsidiary and Wegelin, Switzerland’s oldest private bank; and criminal investigations of about a dozen Swiss banks. About 100 Swiss banks seek to avoid prosecution by disclosing how they helped Americans dodge taxes.
To view the full Bloomberg report, click here.