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Bank Leumi admitted preparing false tax returns for the U.S. taxpayers

Posted by: Zaher Fallahi
Posted On: Dec 23, 2014

On December 22, 2014, the US Department of Justice (DOJ) made an announcement that it had agreed on deferred prosecution deal with the Bank Leumi Group, the Israel’s oldest bank. The Bank admitted preparing false tax returns for the U.S. taxpayers who secretly held their accounts through the Bank.  Under the terms of the agreement, Leumi shall pay the US Treasury $270 million which includes $157 million in penalties for its Switzerland Private Banking. In addition, the Bank Leumi Luxembourg and Leumi Private Bank will not provide banking and investment services to the US taxpayers. Furthermore, the Bank will disclose names of 1,500 of it US customers, and will provide testimony regarding other investigations.  UBS, the Swiss bank entered into a similar agreement in 2009 with the DOJ and the various charges of almost $800 million.

Mr. Larry J. Wszalek, of the DOJ Tax Division, pointed out to the division’s international combat of the criminal conducts committed by the foreign financial institutions.  According to the Tax Notes, he stated in a statement that “Those institutions that have engaged, or continue to engage, in conduct similar to that of Bank Leumi Group are well advised that the Tax Division will continue to extend its global reach in enforcing this nation’s criminal tax laws”.

Zaher Fallahi, is a California Tax Attorney and a CPA, practices as Los Angeles Tax Defense Attorney and Orange Tax Defense Attorney, and assists taxpayers including Americans Living Abroad and Non-Resident Aliens subject to the US tax law, in resolving their tax problems regarding their Offshore Voluntary Disclosure Program (OVDP), Report of Foreign Bank and Financial Accounts (FBAR), Foreign Account Tax Compliance Act (FATCA) and Foreign Trust.  Telephones: (310) 719-1040 (Los Angeles), (714) 546-4272 (Orange County), e-mail [email protected]