by Brian Mahany
Sean and Nadia Roberts of Tehachapi, California had it made. Great jobs as flight instructors, access to aircraft and lots of spare cash. Instead of paying taxes and properly reporting their money, however, they attempted to hide it in a Swiss bank account at UBS. Thinking they were smarter than the average Joe who hides money in an offshore account, the Roberts decided to move their money when the IRS and Justice Department began sniffing around at UBS.
The Roberts moved their money to a Liechtenstein bank, to Hong Kong and even New Zealand and South Africa. Along the way, they created nominee companies, created a constellation of companies with no legitimate purposes and even created an entity in the tiny island nation of Isle of Mann. The Roberts also got caught.
On June 20th, husband and wife agreed to plead guilty to a felony count of filing a false income tax return.
What went wrong? Plenty. This case serves as an important lesson for those that think they can simply move their money and not get caught.
First, the feds secured the cooperation of the Swiss banker. So much for bank secrecy. When faced with the great weight of the United States of America and the rest of the developed nations, even Swiss bankers are willing to cut a deal.
Second, wire transfers are easily traced. Simply writing a check or wiring the monies from the account leaves a paper trail.
Finally, the Roberts went over the top. The more you move money to so called tax havens and create complex constellations, the more you increase your chance of getting caught.
What could have been a manageable tax bill is now likely a huge assessment and a stay at Club Fed. Much like the Eagles song Hotel California, their stay in Club Fed will be one where you can check in but you can never leave. In the case of the Roberts, my prediction is that they will be dealing with Uncle Sam for many years.
If you have money in a foreign account and have not declared the income or filed Reports of Foreign Bank and Financial Accounts (FBARs), don’t do something foolish. Contact us instead. We understand foreign reporting requirements and are happy to stand between you and the IRS. People do make mistakes, let our tax lawyers protect your rights and insure that you are treated fairly.
Want more information? There is no obligation. We can assist with FBAR reporting and participation in the last chance offshore tax amnesty program (“Offshore Voluntary Disclosure Initiative”). Attorney Brian Mahany can be reached at (414) 704-6731 (direct) or by email at
Mahany & Ertl, LLC – America’s tax lawyers. Offices in Milwaukee, Wisconsin; Detroit, Michigan & Portland, Maine. Services nationwide.