US crackdown nets guilty plea from ex-asset manager

Credit Suisse execs testifying before US Congress last year as part of an ongoing probe into tax evasion Keystone

Federal prosecutors in the United States have obtained another guilty plea in their continuing crackdown on Swiss banks and financial services that helped Americans cheat on their taxes.

The guilty plea by Swiss former asset manager Peter Amrein in a federal court in New York comes amid a criminal investigation that US authorities have said still includes 14 Swiss banks, notably the second-largest, Credit Suisse Group.

Amrein pleaded guilty before a federal judge on Tuesday to helping Americans avoid paying taxes from 1998 to 2012 through undisclosed accounts with now-defunct Wegelin & Co. and several other Swiss banks.

He worked during those years first as a client adviser at a Swiss bank headquartered in Zurich and later as an asset manager at an asset management firm, also based in Zurich, according to the indictment that the US Justice Department made public in February.

Amrein faces a possible prison sentence of up to five years for conspiring to defraud the US Internal Revenue Service, evading federal taxes and filing a false tax return.

The institutions where he worked were not identified in the indictment, which accused him of conspiring with a Zurich-based Swiss lawyer, Edgar Paltzer, in setting up hidden accounts at Wegelin and at least four other Swiss banks that were not identified, some using names of made-up foundations in Liechtenstein.

Wegelin, which was Switzerland’s oldest private bank, announced its closure after agreeing to pay $74 million (CHF71.8 million) and pleading guilty in 2013 to helping wealthy American clients avoid paying taxes.

More than 100 people

The Swiss lawyer pleaded guilty to charges in New York in 2013 and has been cooperating in the US crackdown that has so far netted charges against more than 100 people, according to a plea agreement filed with the court.

The IRS and Justice Department investigation into Switzerland’s biggest bank, UBS, as part of efforts to cut off Americans’ use of offshore accounts to dodge US taxes became public in 2008.

A year later, UBS became the first bank to settle with US authorities. It paid a $780 million US fine and disclosed names of thousands of American account holders to the IRS, many of whom were later prosecuted.

On Monday, US authorities said Lugano-based BSI bank has become the first Swiss-based bank to complete the non-prosecution programme set up in 2013 to clear up past tax evasion offences. BSI, which had more than 3,000 active accounts relating to US citizens after 2008, was fined $211 million for aiding and abetting tax cheats. The justice department blocked 14 Swiss banks, or Swiss-based branches of foreign institutions, from joining the programme because they were actively being investigated for alleged crimes as of August 2013. Those included Credit Suisse, which was fined $2.8 billion last year, Julius Baer, Pictet and the cantonal banks of Zurich and Basel.