Swiss Life to pay $77.4 mln to settle U.S. criminal tax evasion case

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The logo of insurer Swiss Life is seen at its headquarters in Zurich, Switzerland March 2, 2021. REUTERS/Arnd Wiegmann

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NEW YORK, May 14 (Reuters) - Swiss Life Holding AG (SLHN.S) agreed to pay $77.4 million and enter a deferred prosecution agreement to resolve a U.S. criminal case in which Switzerland's largest insurer was accused of helping wealthy American clients evade taxes.

The three-year agreement announced on Friday resolves a charge that Swiss Life conspired to defraud the U.S. Internal Revenue Service by concealing more than $1.45 billion in offshore insurance policies.

These included more than 1,600 "wrapper" insurance policies into which taxpayers can place stocks, private equity holdings and other assets.

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U.S. prosecutors began cracking down more than a decade ago on the use of Swiss banks to avoid federal taxes.

Swiss Life and its affiliates viewed this "stepped-up offshore tax enforcement as an opportunity to pitch themselves to tax-evading U.S. customers as an alternative to Swiss banks," U.S. Attorney Audrey Strauss in Manhattan said in a statement.

The Zurich-based insurer will pay a $25.3 million fine plus $52.1 million in restitution and forfeiture, and hand over information about accounts it closed between 2008 and 2019.

Swiss Life has said it set aside sufficient funds in 2020 to cover the payment.

Its general counsel accepted the deferred prosecution agreement at a hearing before U.S. District Judge Gregory Woods in Manhattan.

An agreement by Swiss bank UBS (UBSG.S) in 2009 to pay a $780 million penalty and hand over names and data on thousands of client accounts helped kick off numerous settlements with other Swiss financial companies.

Rahn+Bodmer, Zurich's oldest private bank, agreed in March to pay $22 million to settle U.S. charges it helped taxpayers who fled UBS and other Swiss banks hide money in offshore accounts. read more

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Reporting by Jonathan Stempel in New York, Editing by Franklin Paul

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Award-winning reporter covering U.S. courts and law from the COVID-19 pandemic to high-profile criminal trials and Wall Street's biggest failures with more than two decades of experience in international financial news in Asia and Europe.