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09-08-25 UBS-AG Whistle-Blower Birkenfeld Imprisoned
UBS Whistleblower Gets Rewarded With Prison Time
Commentary by Ann Woolner - August 25, 2009 21:00 EDT
UBS-AG Whistle Blower Bradley Birkenfeld
Aug. 26 (Bloomberg) -- If he had kept his mouth shut and his head low, Bradley Birkenfeld would be afree man today. He didn’t, so now the former UBS AG banker wears an electronic bracelet on his ankleand, beginning in January, will spend three years and four months in a federal penitentiary.He’s headed for prison even though he blew the whistle on a multibillion-dollar international tax fraudconspiracy. Birkenfeld’s information let the U.S. pierce Swiss bank secrecy laws as never beforepossible.“We will be receiving an unprecedented amount of information on taxpayers who have evaded their taxobligation by hiding money offshore at UBS,” Internal Revenue Service CommissionerDougShulmansaid in a statement last week.Because of Birkenfeld, the feds are now going after hundreds, possibly thousands, of tax evaders. Theyhave collected a $780 million fine from UBS and forced the bank’s cooperation in finding previouslysecret customers.The list of those so far charged in the scheme numbers nine, led byRaoul Weil, the former chief executive officer of global wealth management for UBS.So why is the man who blew the whistle on a mammoth tax fraud facing prison time? The feds will tellyou it’s because he played a role in the conspiracy, a fact he failed to mention when he first steppedforward.So far he has gotten rougher treatment than those who were content to hide in the shadows. Birkenfeld’sbiggest ex- customer, California billionaireIgor Olenicoff , got only probation (and only two years of that!) for hiding as much as $200 million from the IRS. He also paid the government $52 million in back taxes, interest and penalties, thanks to Birkenfeld.Return to SwitzerlandBirkenfeld’s ex-boss, who ran the global tax-fraud business, made out even better than Olenicoff. Heldas a material witness for some months in 2008,Martin Liechtipleaded the Fifth Amendment whencalled before Congress and was allowed to return to Switzerland, a free man, charged with no crime.