CreditSuisse Releases More Data to the DOJ

Explore:  OVDP

In a recent news announcement Swiss banking giant, CreditSuisse announced that it would release previously protected data to the U.S. DOJ for the period Jun, 2001 – March 2011. The data may include emails to clients and internal memos. For those U.S. taxpayers who have not already come forward and disclosed previously unreported foreign accounts, the action of CreditSuisse should serve as a warning that time is running out.

Individual income tax returns are due June 15, but with extensions can be filed as late as October 15. With the returns for holders of foreign financial accounts of $50,000 or more at year ending is the requirement that Form 8938 be filed. This is an income tax form and requires disclosure of all foreign financial assets, including bank and brokerage accounts and statements of Fair Market Value. Form 8938 is in addition to the Report of Foreign Bank Account (FBAR) which is a Bank Secrecy Act form that is due by June 30 if the taxpayer has signature authority over foreign financial accounts of $10,000 or more in the aggregate.

Taxpayers are required to keep records of foreign financial assets and can be compelled to appear before a Grand Jury to produce those records or explain why they cannot be produced. Such compelled testimony does not violate the Fifth Amendment privilege against self-incrimination. In M.H. vs. U.S. the 9th Circuit stated: “Because the records sought through the subpoena fall under the Required Records Doctrine, the Fifth Amendment privilege against self-incrimination is inapplicable, and M.H. may not invoke it to resist compliance with the subpoena’s command. See Doe M.D., 801 F.2d at 1167 (“Records that are required to be maintained by law are outside the scope of the privilege [against self-incrimination].”). Because M.H.’s Fifth Amendment privilege is not implicated, we need not address his request for immunity. Bouknight, 493 U.S. at 562 (declining to “define the precise limitations that may exist upon the State’s ability to use the testimonial aspects of Bouknight’s act of production in subsequent criminal proceedings”)”

The failure to produce records can be a basis for a finding of “willfulness” in assessing penalties for failing to file FBAR’s. It can also be a basis for a false statement cirme allegation for signing an income tax return without properly completing Form 8938.

For all these reasons and more, it is important for taxpayers to consider the coming forward now, before their information is obtained by the DOJ or IRS and they are then prevented from entering the Offshore Voluntary Disclosure Program (OVDP) because they are no longer eligible.


Written by:

Published In:


DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

© Sanford Millar, Law Offices of Sanford I. Millar | Attorney Advertising

Don't miss a thing! Build a custom news brief:

Read fresh new writing on compliance, cybersecurity, Dodd-Frank, whistleblowers, social media, hiring & firing, patent reform, the NLRB, Obamacare, the SEC…

…or whatever matters the most to you. Follow authors, firms, and topics on JD Supra.

Create your news brief now - it's free and easy »

All the intelligence you need, in one easy email:

Great! Your first step to building an email digest of JD Supra authors and topics. Log in with LinkedIn so we can start sending your digest...

Sign up for your custom alerts now, using LinkedIn ›

* With LinkedIn, you don't need to create a separate login to manage your free JD Supra account, and we can make suggestions based on your needs and interests. We will not post anything on LinkedIn in your name.