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Scott Michel Comments on Taxpayers Seeking Entry To OVDP

May 12, 2015, Bloomberg BNA

Bloomberg BNA's International Tax Monitor and Daily Tax Report quoted Scott D. Michel on why taxpayers should act fast on entering the Offshore Voluntary Disclosure Program before the Department of Justice makes more of its offshore bank investigations known to the public. Mr. Michel also mentioned the changing landscape for tax evasion as more non-prosecution agreements with Swiss banks are likely to occur. For the complete article, please click on the link above to view a PDF. 

Excerpt taken from the article.

No Pre-Clearance for Streamlined OVDP

Scott Michel, a member of Caplin & Drysdale in Washington, cautioned that taxpayers who want to enter the OVDP need to act fast before the Department of Justice starts making more of its offshore bank investigations known to the public.

Once those investigations or resulting agreements have been publicized, the OVDP penalty faced by account holders at those banks jumps from 27.5 percent to 50 percent, he warned.

‘Quickly Changing Landscape.'

The Justice Department has already announced two non-prosecution agreements with Swiss banks that have agreed to pay hefty fines and turn over account information in order to avoid charges of tax evasion. Michel said more are likely to be coming soon as part of a program involving dozens of banks (61 DTR K-3, 3/31/15).

"There will be a quickly changing landscape over the next few months," Michel said. He said with the data the government has already gleaned from its crackdown on Swiss and other banks, "it seems to be the case over the past two or three months that new investigations have been spawned."

He said although banks over the past year have been actively encouraging voluntary disclosures to reduce their own penalties under the NPAs, that activity has waned, and banks' incentives to go into the OVDP are drying up.

"If anybody's sitting on the fence thinking that they're going to get a better deal from their Swiss bank, I wouldn't recommend it," Michel said.


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