New FBAR Case Supports Lingering Criminal Exposure For Late Filings Under FAQ

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In a recent appellate case, the taxpayer filed required FBAR’s late, using the filing procedure allowed for late filings under the 2009 OVDI FAQ. Nonetheless, the court found that the FAQ relief from civil penalties was not a bar to the government asserting criminal penalties.

Thus, those doing late filings under the OVDI FAQs should not consider them necessarily safe from criminal prosecution.

In the case, the taxpayer did not qualify for using the late filing FAQ anyway, since not all offshore income had been reported timely. Nonetheless, it appears the court would still have allowed criminal liability even if the FAQ applied.

There were some bad facts that surely contributed to the government’s attitude, and possibly that of the court. For example, there was an offshore trust, and lots of money being spent. Nonetheless, the taxpayer hardly reported any income and sought financial aid for his children’s education. The taxpayer was also a CPA. Whether a different result would have arisen absent these facts cannot be gauged.

US v. Simon, 7th Circuit Court of Appeals, August 15, 2013

Topics:  Criminal Prosecution, FBAR, Filing Deadlines

Published In: Criminal Law Updates, Finance & Banking Updates, Tax Updates

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.

© Charles (Chuck) Rubin, Gutter Chaves Josepher Rubin Forman Fleisher P.A. | Attorney Advertising

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Charles (Chuck) Rubin
Gutter Chaves Josepher Rubin Forman Fleisher P.A.

A tax and business attorney who assists clients in preserving & enhancing individual, family &... View Profile »


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