Martin Lack, the fourth ex-UBS AG banker to plead guilty to aiding wealthy Americans in evading taxes, avoided prison for a 17-year scheme in which he helped U.S. clients maintain secret overseas accounts.
Lack, a Swiss resident and citizen and an independent investment adviser, was sentenced to five years of probation and fined $7,500 today in federal court in Fort Lauderdale, Florida, where he was indicted in 2011. He surrendered to U.S. authorities on Oct. 14 and pleaded guilty on Feb. 26, when the judge said he was cooperating with prosecutors.
Lack was charged in an indictment with conspiring from 1993 to 2010 to help clients hide assets from the U.S. Internal Revenue Service through accounts at Zurich-based UBS, the largest Swiss bank, and a Swiss cantonal bank. That bank, not named in the indictment, is Basler Kantonalbank, according to a person familiar with the matter.
Lack worked at UBS until he founded his own management firm, Lack & Partner Asset Management AG, in Zurich in 2002, according to prosecutors. He “would and did solicit U.S. customers to open undeclared accounts at UBS and cantonal bank because Swiss bank secrecy would assist U.S. customers to conceal their ownership of the accounts,” according to the indictment.
About three dozen foreign bankers, lawyers and advisers and more than 70 taxpayers have been charged in the past five years. Thirteen Swiss banks are under criminal investigation after Credit Suisse AG pleaded guilty last week to helping Americans evade taxes.
More than 43,000 U.S. taxpayers have avoided prosecution since 2009 by voluntarily disclosing their offshore accounts to the IRS and paying back taxes and penalties.
Other former UBS bankers who pleaded guilty are Christos Bagios, Renzo Gadola and Bradley Birkenfeld. After serving a prison sentence, Birkenfeld received a whistle-blower award of $104 million for revealing how UBS helped Americans evade taxes.
Gadola pleaded guilty in December 2010, admitting he serviced hundreds of secret Swiss accounts at UBS from 1995 to 2008 and later as an asset manager. He helped U.S. prosecutors and was given five years’ probation by a judge who cited his “extraordinary cooperation.”
Gadola and Lack were accused of discouraging taxpayers from joining the IRS voluntary disclosure program.
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