About those UBS Accounts

June 9th, 2009

A Reuters piece on June 8 reported that many American clients of disgraced Swiss bank UBS are negotiating with the IRS to voluntarally disclose their holdings in order to avoid prosecution on tax evasion charges.  The article noted that a Tampa-based attorney representing some of those clients said, as Reuters put,  “a significant number . . .  under scrutiny by U.S. tax authorities were wealthy Jewish individuals and families, many of them descendants of survivors of the Nazi Holocaust who had set up accounts in Switzerland to protect their assets.”   This raises a couple of questions.

First, how many is a “significant” number?  Does this refer to a percentage of  the attorney’s clients or all Americans with UBS accounts?  It would be interesting to know how prevalent this is since it is brought up quite often as justification for these secret holdings.  There are some 52,000 UBS accounts held by Americans; the bank will not provide information  to the IRS on any of them.   Presumably, only the IRS could estimate with an semblance of accuracy how many accounts had ties back to Nazi Germany .  Unless the IRS makes an estimate, any estimate of holocaust-related accounts is just a guess.

Second, and more importantly, so what?  For the sake of argument let’s say a significant number of those accounts had originated from money being spirited out of Nazi Germany.  That could mean, depending on your definition,  four or four hundred or four thousand accounts were opened during that terrible time in history.  But the war ended in 1945.  At what point does personal responsibility kick in?  In how many generations after the justification for opening the account disappears should it be expected that those accounts are divulged to the IRS?  At what point should it be expected that the owner of the accounts acts in a lawful manner and reports their income on that Swiss account?

The time has long since passed when these accounts should have been brought into the light.

Written by Tom Cardamone

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