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August 6, 2013

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Liechtenstein No Longer Taxpayer Safe Haven

Liechtensteinische Landesbank AG, located in Vaduz, will pay $23.8 million to settle a probe into its use of undeclared accounts to help U.S. taxpayers dodge taxes over a 10-year period. U.S. Attorney Preet Bhara announced the agreement, saying the bank will forfeit $16.3 million, representing revenue it earned for maintaining the undeclared accounts, and will pay $7.5 million in restitution to the IRS.

The bank, also known as LLB Vaduz, will not be criminally prosecuted for opening and maintaining the accounts from 2001 to 2011 even though it helped many U.S. taxpayers evade their taxes. It was noted that the bank implemented a number of measures to stop aiding U.S. taxpayers even before the IRS got involved. The parliament of Liechtenstein recently changed its tax laws in order to make it easier to identify these non-compliant taxpayers to the United States. Since then, Liechtenstein has transferred more than 200 files of U.S. taxpayers to the U.S. Department of Justice.

Offshore Accounts/International Tax Disputes