American property developer claims Swiss bank responsible for his tax evasion
A billionaire claimed a
Swiss bank was responsible
for his tax evasion.
Igor Olenicoff, a billionaire and former customer of Swiss bank UBS AG, claimed that UBS bank informed him that he did not have to report $200 million to the Internal Revenue Service (IRS). A U.S. federal judge ruled in favor of the bank, according to Reuters.
Olenicoff avoided paying his taxes, but alleged that the bank's practices involved fraud and conspiracies in regards to the $200 million he kept in offshore accounts. The IRS has legal requirements that state taxpayers must disclose all accounts on tax returns through the use of W9 forms.
Judge Andrew Guilford of the U.S. District Court in California issued his ruling in favor of the bank in early April, a month before this case was to go to trial.
Olenicoff made his billions through American property development, but pleaded guilty to tax evasion in 2007 and for hiding information about his offshore accounts on his tax returns. Olenicoff paid $52 million in back taxes after this incident.
The case raised the issue of whether clients of Swiss banks can legally depend on the tax-related advice of private bankers in regards to their accounts. The judge defended his decision by explaining that, regardless of the bank's poor tax advice, Olenicoff doesn't have the right to blame UBS for his own mistakes. The property developer sought $1.7 billion in damages in this civil case.
The Swiss bank issued a statement regarding the case.
"We are pleased with the court's decision. It corresponds with our view that Olenicoff's claims for damages have been without merit. The judge confirmed that Olenicoff cannot turn to UBS to blame it for his own omission/failures to disclose his offshore accounts and to pay taxes," UBS spokeswoman Torie Von Alt said in the statement.
Chicago banks or companies in a similar situation should look to the advice of a Chicago litigation or