“Tax Problems with tax evasion usually start with a disaster – with an unexpected house-search of the tax inspectors beginning at 6 o’clock in the morning at your home.”

Once a criminal investigation for tax evasion has started, you have lost the opportunities and benefits adhering to an Offshore Voluntary Disclosure Program. Voluntary disclosure of secret black money no longer brings impunity. If the tax agency has not discovered your non-tax-compliant bank account, you are authorized to participate in the Offshore Voluntary Disclosure Program and legalize your assets.

An underestimated Risk – The Lists with Tax-Evaders on stolen CDs
An efficient defence strategy starts as early as possible. In contrast to usual criminal charges, for criminal charges in connection with tax evasion, you must engage your lawyer as soon as possible. The precaution works not only for Europe but all countries of the world. If you have an undeclared private bank account with a private bank in Switzerland or another offshore jurisdiction, you will have tax problems – sooner or later. It’s imperative to hire a lawyer immediately to put in place tax solutions to your tax problems.

Your name could already appear on one of the various Lists with Tax Evaders on a stolen CD purchased by the tax authorities. Criminals have downloaded lists with the names of hundred thousands of clients of Swiss banks. They have illegally sold such CDs to the European tax authorities. You cannot verify if you are already listed or not. You don’t know it.

“Be prepared for the worst case scenario!”

Tax problems can start with an investigation against you. The tax investigation always begins with a house search at your home or your office. The tax inspectors will knock on your door early in the morning looking for evidence to be used against you. The high-tax countries have now exchanged between them all sorts of Lists with Tax-Evaders on stolen CDs. The consequences of the stolen CDs are thousands of house searches all over Europe. House searches have become very frequent in investigations in connection with tax evasion. Therefore, we decided to publish 9 Tips to deal with tax inspectors in case of a house search. The 9 Tips are not tax solutions to your tax problems, but the tips are helping you avoiding the most common mistakes in a house search.

House Search: How harmless Statements can put you in Prison
It is crucial for investigations in case of tax evasion to put tax inspectors under the pressure of being reviewed by lawyers for their actions. That is important to achieve good end-results concerning the final tax solutions for our clients. The tax inspector will step back from searching through documents and premises that are not explicitly mentioned in the house search warrant. The most fatal mistakes in defence of tax evaders are made at the very beginning of the procedure. Under the shock of the ongoing house search, you should not make statements making attractive tax solutions impossible at the end of the procedure. There is always time enough to make statements, at a later stage.

The victim of a house search is suffering under tremendous moral pressure, on the day of the house search. Be relaxed, as much as you can. Don’t falsely mean that you must immediately show remorse and make a clean sweep. The tax inspectors are psychologically trained. Without legal assistance, you can be sure that the investigators will take advantage of your psychological weakness. The best thing you can do is to shut up. Silence is golden. The immediate advice of a lawyer will save you from the worst mistakes at the beginning of the tax investigation.

Silence will Pay Out
After the psychological stress period in connection with the house search, a supposedly calm returns. The tax inspectors evaluate the confiscated documents. At the beginning of the procedure, the investigators are under pressure to succeed. If they are already conducting a house search, then they must also find incriminating evidence. As soon as incriminating evidence emerges, the burden of success lingers on the investigators. The evidence must now be utilized. The tax authorities are under pressure to close the investigation. The pressure to close the case promotes the readiness for a settlement. Most jurisdictions allow a solution of the pending case by settlement agreement.

Settlement Negotiations with the Tax Agency
The lawyer should prepare the client for the settlement negotiations with the tax authority. We will discuss with you what can be the worst case scenario. We will analyse if you qualify for a Voluntary Disclosure Program. Each country has different laws. For many years, we have been serving clients from all over the world with undeclared bank accounts in Switzerland and elsewhere. We supported clients from across the globe making their assets tax-compliant.

We provide you with 9 practical tips to be prepared for a house search of the tax inspectors.

1.1. Alert Tax inspectors are at the door and desire inlet – keep calm
Instruct your wife to reassure the children. Let the tax inspectors enter. The house search can no longer be prevented. Resistance is futile and counterproductive. Do not try at the last moment before opening the door to flush down documents in the toilet or throw records out of the window. The investigators were already in the cellar. They turned off the water to prevent this old trick. An investigator is already standing in the backyard ready to intercept documents thrown out of the window. Experience shows that both sides make many mistakes in the first quarter of an hour of the house search. Stay calm and prudent. By following my advice, you avoid making the most common mistakes.

1.2. The written search warrant or danger in default?
Request a copy of the search warrant. There it is written, which premises may be searched. Only documents relating to the tax types and tax years explicitly mentioned in the search warrant may be confiscated. Such a severe interference with personal liberties may only be carried out in strict compliance with the principle of proportionality.

Based on the wording appearing on the search warrant you can see if it’s directed against you as a defendant or against a third party. You will see precisely if you or a third party is suspected. If there is no written search warrant, it may only be searched in case of a “danger in default”.

Ask the tax inspectors to justify the reasons for a “danger in default”. Make a handwritten record reflecting the reasons. Collect the date and the signatures of the tax inspectors on your paper. This is part of the entire strategy to achieve good results with acceptable tax solutions at the end.

1.3. Be discreet and write down the names of the tax inspectors
Resistance to the search is pointless and only hurts. Avoid involving third parties. Ask the tax inspectors to place them in a segregated room so that their presence does not attract attention from uninvolved third parties. If you feel that a searched room is not explicitly mentioned in the search warrant, write a protest note in the house search protocol.

1.4. How far are the tax inspectors allowed to go?
The tax inspectors are not allowed to touch you unless they have an arrest warrant. Even room arrest and telephone ban are illegal. Notify us by phone so we can instantly arrange a tax lawyer and a criminal defence attorney for you – on the spot. Ask the investigators to wait until the legal representative is on-site. Depending on the legal system of the country concerned, they are obliged to wait or not. In Germany, for example, they are not required to wait.

1.5. Silence is worth gold – Do not give statements
Do not say anything to the point. Silence is worth gold. Call on your right to refrain from testifying. You have enough time to talk later. You are in a state of emergency. You are not able to make objective statements. So do not make comments and keep your mouth shut. Over-hasty words have proved to be fatal in many cases. Did you know that accused police officers will testify before the judge at the very end of a procedure?

You cannot know today how the process will develop and what evidence will emerge subsequently. Early statements can often be used against you. Do not use arguments at an early stage that you could later bring to your dismissal. Make your employees silent, or at least convince them not to remember.

Do not release your tax adviser from professional secrecy. You will regret it. Tax inspectors always try to obtain evidence through the tax consultants. Tax investigators are notoriously trying to persuade you to absolve your accountant of confidentiality. Tax investigators are psychologically trained. They can present you false facts with empty promises. They will try to convince you that a co-operation pays off. A co-operation never pays off; certainly not in the initial phase of the procedure. Do not believe a word. Only trust your lawyer.

If you negotiate alone with the tax inspectors, you have already lost. Tax inspectors are well trained to make false promises, knowing in advance that they will not comply. This is the job they have been practising for decades. These rules of the game apply all over the world. Every police school has carved these rules in stone.

“Negotiating with tax inspectors alone means competing against a heavyweight boxing champion. You will go down to the ground after the first 10 seconds by KO defeat.”

If you release your tax adviser from professional secrecy, he must hand out all the documents in full to the tax inspectors – even those of which was never mentioned before. He must give exhaustive answers to all questions posed. He will be forced by law to co-operate fully.

1.6. Watch the inspectors and never leave them alone
All inspectors must be constantly monitored. However, the inspectors must not be hindered. Cabinets and safes must be opened on request. PC may be operated directly by the inspectors.

1.7. You are authorized to ask for a formal seizure warrant listing the seized documents
Do not give your consent to capture your documents. You should insist and ask for a formal seizure warrant. That’s a procedural necessity. Only a formal seizure warrant can be appealed within a subsequent procedure. Ask for a detailed directory mentioning the documents seized. General descriptions such as “files in the filing cabinet” or “file folders” are not sufficient. You should make copies of all confiscated files.

1.8. Document all steps of the search
An efficient representation needs sufficient documentation. Start making minutes as soon as possible. If you wait too long to prepare the minutes, you might forget important details for your defence.

1.9 No House Search during the weekend
As a general rule, we can affirm that no house search will take place during the weekend. According to our professional experience we never had a case with a house search taking place during the weekend.

Here, you will know it – in detail!

The Voluntary Disclosure Program for offshore assets with secret bank accounts abroad is a speciality. It represents one of the best tax solutions for our clients to solve tax problems with undeclared assets offshore. For thousands of clients with secret bank accounts in Switzerland, the Program represents the ideal tax solution.

We have experience in many countries with such programs: USA, Canada, Germany, Italy, Brazil, Argentina and Belgium. Already in 2014, we started with the Offshore Voluntary Disclosure Program (OVDP) in the USA. The Offshore Voluntary Disclosure Program (OVDP) in the USA has been the model for many countries, which started with their programs in the sequence.

The same mechanism applies in all countries

The state offers impunity for all taxpayers who are willing to legalize their secret accounts with a Voluntary Disclosure Program and pay all the retrospective taxes, including financial penalties.

The procedure must be tailor-made and very discreet to be successful for the taxpayer ending with the best possible advanced tax solutions. The taxpayer should be in a position to solve his tax problems with his black money forever. Those who misrepresent the taxpayer can quickly create new tax problems. All the Voluntary Disclosure Programs of all countries are only valid as right tax solutions if no other procedure is in progress.

If the Voluntary Disclosure Program will be filed when the tax authorities are already aware of tax evasion, the taxpayer will not benefit from the advantages of the Voluntary Disclosure Program. He can’t participate to the program.

Only those who have up-to-date specialist knowledge and experience can efficiently represent taxpayers. Caputo & Partners have access to a network of specialists. They are familiar with the tax law of the country concerned. We have specialists in accounting and in calculating the tax consequences of financial instruments. Especially with structured financial products, the assessment of the tax consequences can be tricky. In many cases, it is not evident at first glance whether there is a taxable income or a taxable capital gain. Income tax and capital gains are taxed differently depending on the tax regime. Every specialist tax lawyer will be assisted by a criminal tax law expert as soon as criminal elements come to the surface. All experts are coordinated and supervised from Zurich.

Whatever your issue might be…

• Voluntary Disclosure Program
• AEOI & CRS
• International Tax Evasion
• Whistle-blower
• Rewards for Whistle-blowers
• Suspicious Activity Reports (SAR)

We advise our clients from all over the world on all questions regarding international tax evasion. We make an Engagement Letter with our client before he participates in the Voluntary Disclosure Program. He gives us a Power of Attorney with the authority of substitution to solve all his tax problems. This allows us to assign our client a proven expert in the country of residence of the client to achieve the best tax solutions.

We take care of our clients – from A to Z.

We will collect all bank documents and statements. There are some banks asking EUR 5’000 just for the bank statements needed for the Voluntary Disclosure Program. The bank statements and materials collected from the Swiss banks will not leave Swiss territory. The bank statements of our clients are evaluated in Zurich.

Only anonymized bank statements will leave Switzerland. However, this will happen at the last moment before we will file for the Voluntary Disclosure program. A second employee will control the accomplishment of the anonymization. Dealing with bank statements is a sensitive matter. Therefore, we apply the four-eyes-principle.

We successfully legalized offshore bank accounts with Swiss banks having a value of approximately EUR 385 Million belonging to 115 clients resident in Italy based on the Italian Voluntary Disclosure Program.

We have carried out a comprehensive analysis of the client’s portfolio. In over half of the cases, we were able to recover secret retrocessions from the banks, funds and external asset managers for our clients. Since we had to analyse all statements to calculate the tax burden accurately, we have often encountered irregularities such as hidden payments, retrocessions, hidden commissions to trustees and other third-party providers. It is evident that we were committed recovering these improper payments for our clients.

Many of our clients have also been advised by our asset management and asset protection team. For example, we have created exclusive access to a senior asset manager who has been proven to increase his clients’ money in the long term. For another client, we were able to arrange a lucrative club deal for the purchase of an exclusive off-market property.

Since 2014, we regularly receive thank-you emails and holiday greetings from satisfied clients.

In Italy, Italian tax advisers (Ital. Commercialisti), financial experts (Ital. Periti Finanziari), experts in complex transactions/accounting (Ital. Esperto Contabile) and criminal law experts assist us in tax law (Ital. Avvocati Penalisti per reati fiscali)in finding the best possible tax solutions.

The success of the Brazilian Voluntary Disclosure Program RERCT was very limited with the Receita Federal (http://idg.receita.fazenda.gov.br/).

Only about 35% of the estimated offshore assets were legalized with the RERCT I and II. Brazilian offshore investors still have limited confidence in the Brazilian government. The Brazilian customers are afraid of the consequences of a disclosure of their wealth. They are very sceptical solving their tax problems based on the RERCT Amnesty. Due to the high corruption rate financial kidnapping and extortion is a widespread phenomenon throughout South America.

Financial Kidnapping – the consequence of RERCT

In South America, it is widespread for family members of wealthy families to be kidnapped and released against payment. This phenomenon is known as Financial Kidnapping. The fear and paranoia of the wealthy is justified. Exposing the offshore assets to the public means a massive threat to the family’s health and freedom.

The Automatic Exchange of Information (AEOI) taking place on a worldwide scale has a tremendous impact on the living standard of the wealthy population. Families are changing their residence to more secure districts. They are increasing their security measures. The AEOI will transform their lifestyle.

The lack of confidence in the Brazilian government and the risks associated with financial kidnapping were the main reasons for the failure of both Voluntary Disclosure Programs in Brazil known as RERCT I and II. Both Programs have not been considered as attractive tax solutions solving the tax problems with tax evasion.

Co-operation with Prof Dr Simoes Bata – reliable partners for confidential solutions

Abroad, we work only with proven professionals who have already gained international experience. Professor Dr Simoes Bata is in charge to support our Brazilian clients with offshore accounts. He is a lecturer at the University of Sao Paulo for international tax law. He is currently writing his thesis on offshore assets and their legalisation with Voluntary Disclosure Programs with Professor Dr Xavier Oberson in Geneva, an internationally renowned expert in international tax law. Prof Dr Simoes Bata co-operates with a criminal tax law expert in Brazil. We also serve Brazilian clients with double-digit million accounts in Switzerland, who do not meet the requirements for participation in the Brazilian Voluntary Disclosure Program. Some of them are involved in the “Lavajado” scandal and are accused of international corruption.

We work closely with defence lawyers in Brazil. We are collecting exculpatory evidence from the Swiss banks. Our transaction documentation will be used to defend their rights within the criminal procedure in Brazil. We are assembling the documents proving that our customers have not passed over any funds which have been contaminated by corruption or other irregular behaviours.

Every situation has to be analysed carefully, from case to case. There is no off-the-peg patent solution. We adapt all solutions individually to the circumstances and the requirement of the pending case in Brazil.

We will help you to find the way out of your tax trap.

Use the opportunity of our free case evaluation. We help you to escape from the tax trap.

US tax law provides that not only person resident in the USA be taxable. All persons defined under US tax law as so-called “US persons” are taxable despite their place of residence.

Example: German with Green Card living in Germany

A German citizen who worked for a period in the USA and had a Green Card is defined as a US person, although he does not have a US passport. Ownership of the Green Card already creates a global tax liability to the Internal Revenue Service (IRS).

We only looked after private persons who had a bank account in Switzerland. We successfully legalized USD 132 Million for 65 clients qualifying for the OVDP. We offered help for IRS tax problems with our US tax solutions as tax problem solvers. Many Swiss banks have cancelled the contractual bank account relationship with US customers. Swiss banks no longer want to bear the immense liability risks. Even Swiss nationals with US passport are rejected by almost all banks.

Caputo & Partners still maintains few excellent bank relationships to some exclusive Swiss private banks accepting US clients with pleasure. Thanks to our unique network of contacts in the Swiss financial sector we are in the position to offer a tailor-made priority treatment to our US clients. For our US clients, we are opening private banking accounts with very few exclusive Swiss private banks and asset managers duly licensed with the SEC.

More and more US clients are coming to Switzerland for global diversification and protection of their assets. US wealth managers are good portfolio managers for US stocks. Their global orientation is restricted. They are not familiar with global wealth management. US-clients like Swiss banks taking care of their global affairs with global tax solutions. The Swiss private banking industry is very familiar with the global markets and the needs of international clients. In the recent few years, Swiss banks have increased the staff to serve and attract more US- clients.

We are opening Swiss bank accounts for US-clients. We know exactly what they are looking for. We will bring them where US-clients are treated best.

International Co-operation with top US-lawyers for the benefit of our clients

The team of Jeffrey Neiman from the law firm Marcus Neiman & Rashbaum LLP, Fort Lauderdale, Florida, co-operates with us. Jeffrey Neiman worked 11 years for the US Department of Justice. He led the first US-investigation against Swiss banks. He arrested dozens of Swiss bankers before he became a lawyer and changed sides. He was the lead investigator in the US Department of Justice’s first investigation into UBS, which ended with a fine of just USD 780 million in a settlement. If one compares the penalties that Credit Suisse had to pay, UBS has done comparatively well considering the payment of USD 780 million only.

Brand New Law for Whistle-blowers

The new Whistle-blower Act, issued on April 2018, will motivate whistle-blowers from all over the world to co-operate with the IRS.

From April 2018, the new Whistle-blower Act came into force. The American legislator lures again with hefty million premiums. As in the past, we successfully advised Swiss bankers who were involved with tax evasion in the United States. We advised US-individuals with secret bank accounts in Switzerland to make assets tax-compliant in the USA. We offer our specific advice for potential whistle-blowers. Whistle-blower activities are very delicate and risky, but you can earn a lot of money with it.

If you are informed on facts with criminal tax evasion and you are thinking to convert your information in dollars, pay attention. Some Whistle-blower activities can be in strong conflict with the laws of your place of residence. Dealing with US-authorities to be compensated is not an easy task.

A Swiss resident, for example, has to consider the Swiss laws in place. Swiss laws are sanctioning the disclosure of bank account information as illegal intelligence activities for a foreign government. You are considered as a spy acting for a foreign government. Hervé Falciani, the Whistle-blower from HSBC, Geneva, received a prison sentence of 5 years imprisonment for his Whistle-blower activities without earning a Dollar from the French tax authorities, despite the massive volume of information he delivered.

You need legal support if you will successfully act as a Whistle-blower. You have to make sure to be compliant with Swiss laws and US laws simultaneously. First of all, you must ensure that you are going to be compensated successfully. If you plan your activities alone and without legal support like Hervé Faciani did, you are exposed to the risk to end up without being paid and with an unpleasant prison sentence on top of it.

Reviewing complex banking documentation and calculating the tax impact of financial instruments (valuation issues for investment funds, hedge funds and structured products) requires a team of experts to solve international tax problems. The successful representation of clients in a Voluntary Disclosure Program is an international team-work.

Our team-members earn above average because they work on a success-fee basis. We had to take night shifts because we had to deal with short deadlines. Prima Donna’s behaviours are out of place here. In selecting the international team, care is taken to ensure that there are good personal relationships with the tax authorities abroad. Especially abroad, personal relationships can work wonders and shorten procedures.

Despite the few hundreds of Voluntary Disclosure procedures we have successfully closed, we have not had a single complaint from our clients. After completing the Program, all those affected sleep better today. I can guarantee that. Tax Problems with black money is terrible for your health. This has already been confirmed to me by several dozen clients. They are happy with our tax solutions. With a clear conscience, I can claim to have massively improved the health of dozens of (especially older) clients through the participation to a Voluntary Disclosure Program.

The big international tax offices in Milano rejected the Italian migrant workers having bank accounts in Switzerland because the assets amounted to less than one million EUR. Italian guest workers in Switzerland have retired to Italy at retirement age. Most of them left the assets they had acquired in Switzerland with their Swiss bank and did not disclose them in Italy with the Italian Tax Agency (Ital. Agenzia delle Entrate). They were mistaken in not owe taxes to the Italian state.

Thanks to our partners in southern Italy and our excellent organization, we were able to offer the Italian Voluntary Disclosure Program on very attractive terms. Many guest workers have used our services to solve their tax problems. Due to the modest fortune, they did not find tax lawyers in Italy who wanted to take over the mandate. We have discovered this gap in the market. This has created a win-win situation that has brought us many sympathies in the Italian media. One of the five biggest TV station in Italy, La Sette, invited us twice for a live interview.

Many tax firms from Italy, Switzerland, USA, Canada and Brazil have asked us for help. Media from all over the world, such as Bloomberg Business, La Sette, Italy Oggi, Ilsole24Ore, O Globo, Al Jazeera and others have invited us to interviews and expert panels. We are happy to help not only the rich but also the ordinary people of the working class.

Do you have questions on how to legalize your assets? Stop living with the risk of tax evasion.

The first case evaluation is free of charge. Make use of it and solve your problem now.

“A tax problem does not behave like good wine that gets better with age.
Remember, it is never too early to solve a tax issue but often too late.”

The finance minister of North Rhine-Westphalia, Norbert Walter Borjans, was often referred to as a fence by the Swiss media. Since 2010, he has bought a total of 11 CDs with stolen data from Swiss banks for EUR 18 million. In April 2016, he confirmed that he had already distributed the stolen information to 27 European Union countries. The investment volume amounts to CHF 102 billion. 32 billion refers to Italy.

However, the data is partly outdated. In the meantime, more than CHF 160 billion has been legalized and partially repatriated to Italy based on the Voluntary Disclosure program, of which around CHF 100 billion are from Switzerland alone. The Tax Amnesty Program, the Italian Voluntary Disclosure, was a huge success for the Italian government.

The almost EUR 18 million purchase costs for the tax CDs have paid off. Germany alone generated EUR 240 million in tax revenue from these data alone. In addition, EUR 2.1 billion tax revenues have been realized with the Voluntary Disclosure Program and related penalties.

The message is clear: the purpose is to justify the means.

5.1 Unlawfully obtained evidence may not be used
The interpretation of the Swiss law is very fascinating for the legal representatives of tax evaders. Swiss authorities cannot transmit Swiss bank account information abroad if the foreign request for international legal assistance is based on stolen data. The Federal Council wanted to change the law. Third countries without direct contact with the thieves should still receive data. Fortunately, the project with the new law has been smashed. It seems that the Swiss authorities want to be cooperative with other countries.

However, the law leaves no room for extensive interpretation. Foreign legal and administrative assistance requests are illegal if they are based on stolen data. This doctrine of “the fruit of the poisoned tree” is based on the legal principle of a fair trial. Unlawfully obtained evidence may not be used. This principle derives from Article 31 of the Swiss Federal Constitution. The article 31 of the Federal Constitution goes back to the “Habeas Corpus” guarantees of the year 1639.

5.2 The Whistle-blower Hervé Falciani and his List on the stolen Compact Discs
We had a client from Italy with non-tax-compliant Swiss bank accounts in Switzerland and San Marino. It was impossible for him to participate to the Italian Voluntary Disclosure Program. The name of our client appeared on the famous list called “Lista Falciani”. The “Guardia di Finanza”, the Italian Tax Police, has opened an investigation against him. Who is involved in an investigation cannot file for a Voluntary Disclosure Program.

Hervé Falciani worked as a computer supporter at HSBC Private Bank (Suisse) in Geneva, a subsidiary of British HSBC. Falciani hit the headlines in the year 2009 for handing over an enormous amount of bank client data to the French Tax Authorities. Hervé Falciani has stolen the biggest amount with confidential Swiss bank account information in history.

The list contained the names of celebrities:

• Syrian President Bashar al-Assad
• Salman bin Hamas Al-Khalifa Crown Prince of Bahrain
• King Abdullah II is Al-Hussein of Jordan
• China’s former Prime Minister Li Peng
• David Bowie
• Christian Slater aka “Captain Kirk”
• Fernando Alonso
• Playboy Flavio Briatore, manager of the Formula I circus

However, there were also two Blood Diamond merchants wanted by Interpol, including Moses Victor Konig and Kenneth Lee Akselrod.

That time, Bradley Birkenfeld disclosed the approach of US-clients by UBS bankers to the US-Department of Justice. He has been royally compensated with USD 104 million from the Whistle-blower Program in the USA. Hervé Falciani revealed to the French tax authority the bank account information of the clients of HSBC in Geneva. Hervé Falciani was not compensated for the data theft. He made the fatal mistake not to hire lawyers since the beginning. Instead of being paid he received a sentence with 5 years of imprisonment.

5.3 The “Falciani List” – The Atomic Bomb of the Tax Authorities in Europe
The name of our client has been mentioned in the compact disc stolen by Hervé Falciani from HSBC in Geneva. He was known as Womanizer, a licensed poker player and a favourite of the secret services. Hervé Falciani has stolen bank account information of 106,681 physical persons, 20,130 companies, assets of these clients for the period from 9 November 2006 to 31 March 2007, 40 charts full of data in the volume of 70 Gigabytes from HSBC Private Bank in Geneva.

The French tax authorities have made this data, known as “Falciani List”, available to all European tax agencies but also to Argentina, USA, Australia, India, Canada, etc. The Falciani List is considered the nuclear weapon of the tax authorities of Europe. It turns out that of the 2,846 customers residing in France, only 6 had declared their assets regularly. The black-money ratio of HSBC clients from France was 99.8%.

His activities were not limited to some simple screenshots of data as we know from other cases of bank account information theft. Instead, he copied and downloaded the entire customer base with HSBC Private Bank’s clients on a compact disk. Based on the stolen data the tax authorities have collected taxes in the amount of at least EUR 1 billion. Therefore, the Falciani List was the strongest motivating trigger for countless tax evaders to opt for a Voluntary Disclosure Program. In France alone, EUR 34 billion have been legalized and additional tax revenues of EUR 186 million were generated.

5.4 EUR 6 Million of bankable assets on the knife’s edge – legal or illegal?
Read what happened here.

The Italian financial police, the Guardia di Finanza, had initiated criminal proceedings against our client for tax evasion. If this trial ended with a guilty verdict, my client would not have been allowed to legalize his EUR 6 million. Anyone who is already involved in tax evasion proceedings forfeits his right to qualify for the Voluntary Disclosure program. Only those who have remained undetected can qualify for the program.

The legalization based on the Voluntary Disclosure Program was very attractive for our client because so-called “old money” has been involved. Old money means money which was earned many years ago. This means that no income taxes must be paid. The income such as interest, dividends and capital gains is not significant. The income taxes are already barred for many years. He was, therefore, unable to document the source of the funds. Consequently he would have lost all the EUR 6 Million in the case of a guilty verdict for tax evasion.

Our client put us under massive pressure to perform. He called me almost every day during the procedure and always used different phone numbers. He wanted to qualify for the program, at all costs. We first had to discharge him from the mess with the Falciani List and subsequently qualify for the Program. Only a fully acquittal of proceedings could save him.

He made it clear that we needed to support his defence lawyer in Italy because his lawyer was unable to work outside of Italy.

Read the article under “The Whistle-blower Hervé Falciani and his List on the stolen Compact Discs” how we saved our client from being convicted of tax evasion and how we protected the EUR 6 million from the rapacious tax authorities.

The Italian Guardia di Finanza had only one simple document with the name of our client and an account number in connection with a bank account with HSBC. Other data, such as customer wealth data, did not exist. The Italian tax authorities claimed that our client was no longer legitimated to participate in the Voluntary Disclosure Program, as an investigation was already pending against him. Since the authorities had only bad cards in their hands, the Guardia di Finanza delayed the procedure intentionally.

6.1. Pay Attention to the tax trap!
If someone is already being investigated, this person under investigation cannot participate in the Voluntary Disclosure Program. This rule applies to all Programs worldwide. Our client wanted to join the Program at all costs. He had EUR 6 million in Switzerland to be legalized. Since it was old money, which had been invested in Switzerland for over 20 years, he only had to pay tax on the ongoing income of the last few years. If it is not possible to prove the origin of the amounts received for new funds, the tax authority will automatically tax these funds as income. It can be quite expensive if the entire account balance is taxed and subject to the high income tax.

Consequently, he had no more documents available, with which he could prove the origin of the funds. Had he been convicted of tax evasion, he would have to write off his entire EUR 6 million. On behalf of our client, we requested that HSBC in Geneva hand over all the account documentation. The HSBC refused the release. HSBC argued with the 10-year retention period. This had passed away for a long time. There are no documents. We have increased the pressure on HSBC.

To leave no adverse written traces, I have used the phone to do so. I talked to a high-ranking banker on the phone and convinced him to show his co-operative side. Suddenly, all the documents relating to the old account number in possession of the Guardia di Finanza came from the HSBC.

The old records showed that the account was closed in the 1990s. That was the core evidence for our tax solutions. We successfully filed these documents as our documentary evidence with the Italians, so that the authority had to terminate my case with my client due to the statute of limitations. Only now, after having solved his tax problems with the issue with the Falciani List we could start with the Italian Voluntary Disclosure Program legalizing the assets.

“The joy of the client was tremendous. He turned to be another person. We protected successfully his EUR 6 million. We saved his entire account just because we had the idea not to trust the Guardia di Finanza and to start with our own investigation with HSBC.“

From time to time he shows up in my office bringing culinary specialities from Italy. However, he has not repatriated his money – a wise decision. He saved his EUR 6 million leaving the funds on the Swiss bank account. He was clever. He realized that his fortune is not protected in Italy because the funds may be end confiscated in the future; or used to save the Italian bank. In this context, we refer to our article on the recent Bail-in legislation in the EU.

Important Notice!
If you have black money or you are not sure whether it is black money, you should call us. We have to find out the best possible solution for you – depending on your specific situation. The Voluntary Disclosure Program may be an option, but there are other options to be considered. The facts must be analysed very precisely to skilfully play all the aces from a global point of view.

We want to point out that full advice on black money can never be made over the phone. We love to give a brief general insight on the phone, but the full-scale solutions can only be discussed in private in Switzerland – face to face on the table. These precautionary measures serve the sole security of the client. If the tax agency in your country of residence becomes aware of your secret account, you may lose the option to file for the Voluntary Disclosure Program. Therefore, we are very cautious with the confidential treatment of your bank statements and with our email communication.

Attention!
“Attention! Avoid hiring lawyers in the EU if tax evasion is concerned. Don’t trust your lawyer in the European Union. Attorney-client privilege has been abolished for Tax Evasion in the EU. In Switzerland, it still works. The professional secrecy is lifted for tax evasion. The lawyers in the EU are subject to a reporting obligation.”

Germany, France, Italy and other EU countries have abolished the Client-Attorney privilege for tax evasion. That means, in plain language: Your trusted lawyer, from whom you expect help, will denounce you to the authorities for tax evasion. For serial killers, terrorists, mass murderers, genocide and paedophiles professional secrecy still applies in the EU, but not for tax evasion. According to my opinion, something went terribly wrong here with the legislation in the EU.

In Switzerland, the legal professional secrecy still applies for all criminal offences.