It’s not just the U.S. government that wants to get its hands on the list of Americans who hold secretive Swiss bank accounts. Ex-wives, creditors and former business partners are also salivating over the idea that the UBS settlement may lead to the public disclosure of hidden foreign bank accounts.
It’s not just the U.S. government that wants to get its hands on the list of Americans who hold secretive Swiss bank accounts. Ex-wives, creditors and former business partners are also salivating over the idea that a settlement between the U.S., the Swiss government and a Swiss bank may lead to the public disclosure of as many as 4,450 U.S. individuals that used the foreign bank accounts to hide money.
Prominent New York City divorce lawyer Raoul Lionel Felder says he is already getting calls from clients who want to know what they can do to get their portion of the money they always suspected their ex–loved one had tucked away overseas.
“You see allegations of Swiss bank accounts in divorce proceedings all the time,” says Felder, whose clients have included Rudy Giuliani, Robin Givens and the former Mrs. Martin Scorsese. “A lot of divorces are going to get opened up.” (See the top 10 tax dodgers.)
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Tax evasion may only be the beginning of the legal problems facing holders of secret UBS accounts. On Aug. 19, UBS, Switzerland’s second largest bank, agreed to hand over the names of thousands of American clients suspected by the IRS of evading taxes. The settlement comes after well over a year of investigation by the U.S. government into allegations of tax fraud at the Swiss bank.
Should the names become public, lawyers say a raft of lawsuits could hit the account holders from creditors and business partners who may have long believed that the individuals using the accounts were hiding money that wasn’t rightfully theirs.
One lawyer for UBS account holders says he has at least one case in which a client used a Swiss bank account to hide assets from creditors in bankruptcy proceedings. Lying in bankruptcy court can result in jail time, though the statute of limitations on bankruptcy proceedings is generally six years.
Divorce proceedings, however, have no statute of limitations in most states in the country. So no matter when the divorce happened, a divorce settlement could be thrown out if it is disclosed that an ex-spouse used one of the UBS accounts to shield a portion of their assets. What’s more, the new settlement is likely to be harsher toward the party that lied during the original divorce proceedings.
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