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Dean Zerbe Honored As Contender for 2012 Tax Notes Person of the Year

Dean Zerbe
On January 6, 2013 The Urban-Brookings Tax Policy Center was announced as the 2012 Tax Notes Person of the Year. Tax Notes also recognized nine others who were “contenders” for the title. Among the contenders was the National Whistleblowers Center’s Senior Policy Analyst, Dean Zerbe.

Zerbe gained significant recognition in 2012 when he and co-counsel Stephen M. Kohn helped internationally acclaimed UBS whistleblower Bradley Birkenfeld obtain a historic $104 million reward.  Mr. Birkenfeld’s unprecedented disclosure resulted in cracking the illegal offshore Swiss bank system and resulted in over $5 billion recovered for U.S. taxpayers. Birkenfeld’s information forced Switzerland to change its international treaty with the United States resulting in it’s largest bank being forced to turn over the names of over 4,900 U.S. citizens who held illegal offshore accounts.

In Zerbe’s position as Senior Policy Analyst with the NWC he has frequently commentated on the government's development of the revised IRS whistleblower program. He has pressed the IRS to develop guidance on whistleblower anonymity and to define procedures for award payments and timelines for acting on whistleblower information. In addition, Zerbe co-authored with Kohn, on behalf of the NWC, an amicus brief filed with the Tax Court addressing key questions of law governing the IRS Whistleblower program. The brief, linked here, addressed the issue of "collected proceeds" under the IRS whistleblower law. The "collected proceeds" issue impacts hundreds if not thousands of cases in which the IRS must determine whether a whistleblower is entitled to a reward based on monies obtained by the U.S. government related to tax violation.

This Week on Honesty Without Fear

Tune in today at 5:00pm EDT to Honesty Without Fear on Progressive Radio Network.

In the first half, Richard Renner and Dr. Patricia Harned, President of the Ethics Resource Center (ERC), discuss the findings of the ERC's recently-released report on whistleblowing. The report, "RETALIATION: When Whistleblowers Become Victims," found that, "not only is retaliation on the rise nationally, it is rapidly becoming an issue even at companies with a demonstrated commitment to ethics and integrity."

In the second half, Lindsey Williams interviews Steve Kohn about the case of UBS whistleblower Bradley Birkenfeld. Tune in to find out why his prison sentence was unjustified, why the IRS awarded him $104 million, and why a presidential pardon is essential to stopping illegal offshore banking.

Submit Your Question to be asked on air during the show or call in to 1-888-874-4888.

 

Missed last week's episode?? You can listen to the podcast.

Washington Times and FSN discuss importance of The Handbook

Why is Bradley Birkenfeld serving a forty-month prison sentence for giving up his career in private banking and netting billions of dollars in lost tax revenue for American taxpayers?

The answer was simple, according to Birkenfeld’s lawyer and the Executive Director at the National Whistleblowers Center, Stephen M. Kohn. His mistake was walking into the wrong office in Washington DC, the criminal division of the US Department of Justice.

Kohn said the most important step in cases where ordinary citizens step forward to reveal fraud is “who you blow the whistle to and what you say.”

 The Washington Times discusses The Whistleblower’s Handbook: A Step-by-Step Guide to Doing What’s Right and Protecting Yourself, Stephen M. Kohn’s newest released book. The article notes some of the book’s contents such as information on viewing “hotlines” with discretion.

Feature Story News (FSN) Reporters Blog also posted about The Whistleblower’s Handbook, explaining that ways to attain generous rewards for uncovering wrong-doing are revealed in the book.

The Whistleblower’s Handbook is the blueprint whistleblowers need to be prepared from day one.

To purchase the book, please visit the NWC Store.

 

Links: 

The Washington Times "Whistleblowing handbook points up some serious pitfalls" (PDF version)

 

*Sabeen Khanmohamed (a NWC intern) contributed to this posting

 

 

UBS Banker, Bradley Birkenfeld, blew the whistle on Credit Suisse

In June 2007, UBS whistleblower Bradley Birkenfeld revealed detailed information about high-profile individuals and banks, including Credit Suisse, to the United States Justice Department and Internal Revenue Service. Today, World Radio Switzerland (WRS) released their interview with Stephen M. Kohn, Birkenfeld’s attorney and Executive Director of the National Whistleblowers Center.  WRS also released their interview with other renowned whistleblower advocates such as Jesselyn Radack, former Justice Department Ethics Advisor, and Edward Robbins, an attorney specializing in tax controversies.

WRS reports that while he was working in Switzerland, Birkenfeld uncovered fraudulent activities of at least four Credit Suisse bankers who were helping Americans evade taxes and hide their assets.  The list includes senior manager in Credit Suisse American Operations, Marco Parenti Adami.  Currently, Bradley Birkenfeld is serving 40-months in prison.

Stephen M. Kohn said:

“He turned in information about the bank [Credit Suisse] to the Justice Department including the identities of persons who are now subject to criminal indictment.”

In response to the U.S. Justice Department’s three and a half year delay, former Justice Department Ethics Advisor Jesselyn Radack says, “it is more for show” and that justice should not just be selective.

The U.S. Justice Department refuses comment but Credit Suisse is cooperative with, and not a target of, the investigation.

Listen in on Daniel Ryntjes’ report
 

*Sabeen Khanmohamed (a NWC intern) contributed to this posting

CNBC Airs Whistleblower Series "Bounty Hunters"


CNBC is airing a special series by Eamon Javers entitled "Bounty Hunters" this week. You can watch Mr. Javers' report on Tuesday, February 8 and Wednesday, February 9, on "Squawk Box", "Squawk On The Street", and "Power Lunch." On Thursday, February 10 and Friday, February 11, he will report on "Squawk Box" and "Squawk On The Street."

Mr. Javers interviewed NWC Executive Director, Stephen M. Kohn and UBS whistleblower Bradley Birkenfeld, among others. This series is very timely in light of the rulemaking currently in progress for implementing the Dodd-Frank whistleblower provisions. I look forward to watching the rest of the pieces.

Father of UBS Whistleblower Makes Personal Thanksgiving Day Plea for Son's Clemency

Today, Ronald Birkenfeld, father of UBS whistleblower Bradley Birkenfeld, made a personal Thanksgiving Day appeal to President Barack Obama for his son to be released from prison.

In his letter to the President Mr. Birkenfeld stated, "His separation from his loved ones is extremely painful to our family, especially when we know that his sentence is harsher than that of any of the thousands of wrongdoers." Ronald Birkenfeld sadly noted that "the thousands of US citizens with offshore accounts who were granted amnesty will be sitting at home with their families," while his son "who was solely responsible for recovering billions of dollars for American taxpayers" is "sitting alone in a cold cell away from those who love and appreciate him."

The National Whistleblower Center is supporting Bradley Birkenfeld's clemency petition and encourages every American to take a minute out of their day on Thanksgiving to send a letter to President Obama asking him to return Mr. Birkenfeld to his family in time for Christmas.

Stephen M. Kohn, Executive Director of the National Whistleblower Center, issued the following statement: "Given Bradley Birkenfeld's contribution to the public interest, it is a national disgrace that he must spend Thanksgiving in prison. Birkenfeld was responsible for taxpayers recovering $780 million in fines paid by UBS bank. His disclosures lead to over 15,000 Americans turning themselves in under the IRS amnesty program. These tax evaders escaped prison, but paid the U.S. taxpayers back billions of dollars. Birkenfeld, who voluntarily returned to the United States to blow the whistle, is the only UBS banker to be convicted of a crime and he has already served more time in prison than all of the 19,000 millionaires and billionaires who illegally hide their money combined." 

Links:

Ronald Birkenfeld letter to President Obama

Ronald Birkenfeld letter to the American public

Bradley Birkenfeld's official clemency page


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Whistleblower Disclosures Result in Historic International Treaty

The Swiss parliament finally approved the deal made between UBS and the U.S. government that requires UBS to turn over the names of 4,450 U.S. citizens who held accounts at the Swiss bank. The NWC issued the following release:

 
Washington D.C. June 17, 2010. In an unprecedented move the Swiss parliament voted to approve a deal between the Department of Justice (DOJ) and UBS in which UBS has agreed to turn over the names of 4,450 U.S. citizens who held secret and illegal bank accounts at UBS.
 
Lindsey M. Williams, Director of Advocacy and Development of the National Whistleblowers Center, said:
 
"Today's news is bittersweet. While the Swiss government will finally be releasing the names, the outcome is far from a fairytale ending for taxpayers...

 

The agreement with UBS was only for a small portion of the names of tax cheats and the fine was a drop in the bucket compared to the entire $20 billion dollar illegal program.  In order to overcome the damage done by the Department of Justice's prosecution of the whistleblower, Bradley Birkenfeld, the IRS and President Obama should follow the intent of the law and issue Mr. Birkenfeld his reward and immediately commute his prison sentence."

 
Stephen M. Kohn, Executive Director of the National Whistleblowers Center and attorney for Bradley Birkenfeld, said:
 
"Bradley Birkenfeld is the most important fraud whistleblower in American history resulting in one of the largest collections ever, but the deal cut with UBS permits the majority of violators to get off scot-free.  The message from the Birkenfeld case should have been: if you illegally shelter the money you will get caught, if you turn in fraud you will be rewarded. Instead, the message being sent by the Justice Department and UBS is clear: if you get caught your wrist will be mildly slapped, if you turn it the fraud you will go to jail."
 
Dean Zerbe, co-counsel for Mr. Birkenfeld said, "Getting the swiss to agree to release the names is taking more dance steps then Fred Astaire. Clearly going forward the answer has to be for the IRS to work with whistleblowers and the information they provide and not wait for the swiss to finish their tap dancing."

The National Whistleblowers Center urges all members of the public to send letters in support of Mr. Birkenfeld's clemency petition, which is pending before the Pardon Attorney.
 
Links:
 
 
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Senator Grassley Backs UBS Whistleblower, Swiss Parliament Rejects DOJ UBS Deal

*This post was drafted by Meryl Grenadier (NWC fellow)

In the past 24 hours there have been significant developments in the case of UBS whistleblower Bradley Birkenfeld. Three years ago, the former UBS banker provided the U.S. government with detailed information on how to identify the names of 19,000 American citizens who held illegal secret bank accounts at UBS bank in Switzerland (read the letter from Mr. Birkenfeld's attorneys outlining this information here). He reported the largest tax fraud scheme in history, and for the first time there was a crack in the vault of Swiss bank secrecy.

Bradley Birkenfeld also warned that Swiss politicians would do everything in their power to protect Swiss bank secrecy and block the release of UBS client information. This prediction became reality yesterday when the Federal Assembly of the Swiss parliament rejected a part of the deferred prosecution agreement between UBS and the U.S. Department of Justice. This part of the agreement requires UBS to turn over the names of 4,450 American tax criminals by August 20 of this year, a small fraction of the 19,000 clients.

In response to the vote, Senator Charles Grassley sent a letter to the U.S. government, expressing his outrage at the mishandling of information provided by Mr. Birkenfeld and the misguided reliance on the Swiss government for UBS USA information. Senator Grassley wrote (read the full letter here):

I am worried that the Internal Revenue Service ("IRS") is doing next to nothing to identify tax evasion by U.S. taxpayers utilizing these accounts while waiting for ratification of the treaty.

It seems this information [provided by Mr. Birkenfeld] would allow the IRS to trace individuals in the U.S. that had UBS bank accounts…  Using this information to identify U.S. clients would appear to be more productive than simply pursuing agreements and treaties with the Swiss, especially since those avenues seem limited to specific individuals. 

Today's vote in Switzerland only underscores the need for the IRS to encourage whistleblowers to come forward.  Mr. Birkenfeld blew the whistle on just one bank. What is the IRS doing to encourage more whistleblowers to come forward about offshore bank accounts?

As we have written before, the U.S. Justice Department admitted in court proceedings that "but for Mr. Birkenfeld" the illegal $20 billion tax evasion "scheme" by the Swiss banking giant UBS "would not have been discovered by the U.S. government."  Despite his historic contribution toward enforcement of tax laws, Mr. Birkenfeld remains the only banker prosecuted and incarcerated by the U.S. government.

The U.S. Senate estimates that $5-7 trillion in tax revenue is lost in undeclared offshore bank accounts. There must be consistent policies regarding the treatment and encouragement of whistleblowers throughout the U.S. government. It is our hope that Senator Grassley’s letter will encourage a full evaluation of how Mr. Birkenfeld’s information was used (or misused), the prosecution of the high-level UBS officials who initiated and planned the $20 billion tax evasion scheme, and justice for all honest American taxpayers.

It remains imperative that those who support whistleblowers, accountability and transparency continue to send letters in support of Mr. Birkenfeld’s clemency campaign. His prison sentence continues to have a chilling effect on all international bankers who posses similar information.


UBS Whistleblower Files Clemency Petition

TAKE ACTION

Today, Bradley Birkenfeld, the whistleblower who exposed the $20 billion illegal UBS tax fraud scheme, submitted a direct appeal to President Barack Obama and filed an official petition requesting clemency. Mr. Birkenfeld blew the whistle on a $20 billion program run by UBS designed to recruit wealthy Americans and assist them in evading U.S. taxes.

The clemency petition was submitted on April 15th, the deadline for Americans to file their taxes, because the information Mr. Birkenfeld provided has led to the recovery of billions of tax dollars by the IRS.

 

In the appeal to President Obama, Mr. Birkenfeld’s attorneys, Stephen M. Kohn, Executive Director of the National Whistleblowers Center and Dean Zerbe former counsel to the Senate Finance Committee, wrote:

There has never been such an important tax whistleblower in U.S. history. There has never been one courageous individual who, standing along and confronting (at the time) the largest bank in the world, made disclosures that resulted in the recovery for the U.S. taxpayers of billions of dollars.”

Despite the Department of Justice admission that “but for Mr. Birkenfeld” the illegal UBS scheme “would have gone undetected by the U.S. government,” Bradley Birkenfeld was prosecuted and sentenced to 40-months in federal prison, which he is currently serving. Mr. Birkenfeld’s attorneys pointed out the chilling effect this lengthy prison sentence will have on corporate whistleblowers, specifically those in the international banking industry.

The NWC is urging all members of the public to participate in Bradley Birkenfeld’s clemency campaign by sending letters of support to President Obama and the Pardon Attorney. To submit a letter, please click here.

April 15 Plea for UBS Whistleblower

TAKE ACTION!

Attorneys for Bradley Birkenfeld, the Swiss banker who exposed the massive ($20 billion) tax evasion scandal at UBS, Stephen M. Kohn and  Dean Zerbe wrote an op-ed piece entitled “April 15 Plea: Pardon Tax Whistleblower” published on Forbes.com. Mr. Kohn and Mr. Zerbe criticize the Department of Justice decision to prosecute Mr. Birkenfeld and list the negative consequences of putting the whistleblower in jail, including the radical chilling effect that discourages other potential whistleblowers from coming forward, a major step backwards in the fight against corruption and billions of dollars in tax revenue lost.

 

The attorneys wrote:

Mr. Birkenfeld's whistleblowing put a big dent in these secret offshore accounts, but there is lots more out there. It took an insider to blow the whistle the first time and it is going to take another insider to do it again as account holders, especially the most flagrant tax evaders, are now moving monies to banks with even greater secrecy. When the government cannot stop offshore tax evasion, it is the honest American taxpayer who has to foot the bill.

The Forbes piece appeared the day before April 15, the deadline for Americans to file their taxes.  Mr. Birkenfeld filed his official petition for clemency today, and the National Whistleblowers Center has launched an international letter writing campaign on behalf of Mr. Birkenfeld. To write a letter, click here.

Mr. Kohn and Mr. Zerbe also submitted a direct appeal to President Obama, requesting that he pardon Mr. Birkenfeld on Tax Day as a symbol of support for the American taxpayers. According to Birkenfeld’s attorneys: 

Mr. Birkenfeld has served enough time. Today is the day for President Obama to use his pardon power to ensure that ‘justice’ does not come at the cost of what is in the best interest of the American taxpayers.




*Philip Barrett (NWC Intern) & Meryl Grenadier (NWC Fellow) contributed to this post