As the U.S. government's much publicized crackdown on Swiss banks continues, they may be turning their focus to Southeast Asia, where a Singaporean asset-management firm has fallen under criminal investigation. The firm is suspected of accepting transfers from U.S. taxpayers who were forced to shut down their undeclared Swiss accounts when those Swiss banks came under criminal investigation.
Eventually, more than 100 Swiss banks reached non-prosecution agreements with U.S. authorities, in exchange for turning over information about their clients and paying substantial penalties. The U.S. also investigated financial institutions in countries like Liechtenstein, Israel, and the Caribbean.
Until now, however, Southeast Asia had been left alone for the most part. In addition to Singapore, other financial centers like Hong Kong and South Korea could be targeted. The U.S. is also increasing its focus on so-called "enablers," such as attorneys or asset-managers, who advised and assisted clients in hiding their assets in secret offshore accounts.
Since 2009, more than 50,000 U.S. taxpayers have voluntarily disclosed their undeclared accounts through different versions of the ongoing Offshore Voluntary Disclosure Program. Participants in that program are required to provide the identities of individuals who advised or assisted them in the opening or maintaining such accounts. This data has been compiled for several years and is now being used to investigate such individuals.
The names of a number of prominent attorneys, accountants, and wealth advisors have been disclosed to the government and we expect that some of these individuals may soon fall on the Department of Justice's radar. These individuals could potentially face a host of charges, including but not limited to conspiracy to defraud the United States and conspiring to launder monetary instruments.
More than 100 countries around the world have entered into intergovernmental agreements with the United States to implement FATCA, a law that requires foreign banks to exchange information with the IRS about U.S. taxpayers on an annual basis. This includes most of the world's prominent tax havens, such as Switzerland, the Cayman Islands, and Liechtenstein. Americans who still have not disclosed their offshore accounts must act quickly. Once the U.S. authorities obtain information about an American's undeclared offshore accounts, that person is no longer eligible to participate in the voluntary disclosure program.