ZURICH (Reuters) - U.S. prosecutors are accusing Swiss bank Julius Baer of helping more than 400 Americans hide undeclared money from the taxman, according to a ruling made public by a Swiss court on Wednesday.
The 34-page ruling, which paraphrased an IRS request for judicial aid and did not provide supporting documents, is the fullest public picture so far of the case against Julius Baer, one of a dozen of Swiss banks that are the subject of a criminal investigation in the United States into tax evasion.
Julius Baer declined to comment on the ruling.
According to the Swiss ruling, U.S. tax authorities alleged at least 400 Americans hid more than $600 million from the IRS. Julius Baer private bankers used “codenames and numbers”, as well as “travelling account statements”, to conceal the identity of the account owners, the court document stated.
The bank also advised wealthy Americans to use “sham corporate entities” to hide their money and ensured that bank correspondence wouldn’t be sent to them in the United States in order to avoid detection, the court said, citing the IRS judicial aid request.
Julius Baer told clients they were safe from IRS prying because the Swiss bank didn’t have a U.S. office, unlike larger rivals such as UBS, according to the court documents.
Baer has in past said it is cooperating with U.S. authorities, is eager to settle, and that it has handed over documents and other material illustrating its business in the United States.
The Swiss court said the IRS pieced together the information from the indictment in 2011 of two former Julius Baer private bankers, Daniela Casadei and Fabio Frazzetto, as well as from voluntary disclosures from more than 400 one-time clients of the Swiss bank who admitted to their hidden accounts.
Casadei and Frazzetto helped wealthy American clients of Julius Baer hide roughly $600 million in assets in secret Swiss bank accounts that went undeclared to the IRS, according to the 2011 indictment.
The details of the U.S. case against Baer came to light through a ruling backing an appeal by two clients of the bank. The court ruled the couple’s bank account data must not be disclosed to U.S. tax authorities, because the IRS had not provided enough detail to warrant judicial assistance from Switzerland.
A host of Swiss banks not being targeted last month signaled their readiness to work with U.S. officials in the crackdown on wealthy Americans evading taxes. The number that join the scheme is key for larger banks facing criminal investigations in the United States, such as Credit Suisse, Baer and Pictet & Cie.
Reporting by Alice Baghdjian and Katharina Bart; editing by David Evans