FATCA: First criminal conviction for failure to comply
We knew it was coming, but this month we now have the first-ever conviction for failing to comply with FATCA. The US government with help from other countries in what reads like an international James Bond type movie thriller, complete with undercover agents in a sting operation, has shown that they will aggressively pursue those who fail to comply with the law.
Adrian Baron, the former Chief Business Officer and former Chief Executive Officer of Loyal Bank Ltd, an off-shore bank with offices in Budapest, Hungary and Saint Vincent and the Grenadines, pleaded guilty to conspiring to defraud the United States by failing to comply with the Foreign Account Tax Compliance Act (FATCA). When sentenced, Baron faces a maximum of five years in prison.
The guilty plea followed a sting operation in which an undercover agent sought and received the cooperation of Baron in hiding the US persons interest in various offshore accounts.
The guilty plea was announced by the Justice Department’s Tax Division; the FBI, the Internal Revenue Service Criminal Investigation. The U.S. Securities and Exchange Commission (SEC), the City of London Police; the U.K.’s Financial Conduct Authority and the Hungarian National Bureau of Investigation provided significant cooperation and assistance during the investigation.
The DOJ announced earlier that it intended to direct its focus to Asia. Following its efforts in Switzerland, the DOJ gained vital information of where the funds that had been “hiding” in Switzerland had gone. And this information clearly indicated Hong Kong and Singapore as the destination of these “hidden” funds in the old adage of “follow the money”.
The Baron conviction is proof that the US tax authorities are taking the duty to find and prosecute individuals who have committed tax fraud or money laundering offenses, as well as those who have helped the individuals in these efforts very seriously. However the assistance the US tax authorities received from various European authorities clearly demonstrates these efforts are not just focus of the US authorities but is becoming a global effort.
There is nowhere to hide.
Here is the link from the DOJ or full text below: https://www.justice.gov/usao-edny/pr/former-executive-loyal-bank-ltd-pleads-guilty-conspiring-defraud-united-states-failing