NEW YORK
A Privatbank IHAG Holding Company executive admitted to setting up the “Singapore Solution” to hide undeclared bank accounts from the IRS, officials stated.
An executive of the holding company that owns Privatbank IHAG pleaded guilty today to conspiring to conceal over $60 million of undeclared assets held by wealthy American clients of the Swiss private bank.
According to court documents, Daniel Wälchli, a member of the bank holding company’s executive board, worked with others to help Privatbank IHAG conceal the accounts of American customers.
Customers did not want to disclose their Swiss bank accounts to the IRS.
The scheme involved several steps designed to obscure these undeclared accounts by stripping them of any indicia of U.S. ownership.
Known as the “Singapore Solution,” conspiracy members sent over $60 million on “round trips” across the globe, according to officials.
The money was sent from Privatbank IHAG accounts in Switzerland to a bank in Hong Kong before returning to Privatbank IHAG in accounts held by a Singaporean asset manager owned and controlled by the Swiss bank’s holding company.
Under the terms of his plea agreement, Wälchli will not dispute that the tax loss was $531,524.
Wälchli faces up to five years in prison, officials stated.
Acting Deputy Assistant Attorney General Stuart M. Goldberg of the Justice Department’s Tax Division and U.S. Attorney Damian Williams for the Southern District of New York made the announcement.
IRS-Criminal Investigation is investigating the case.
Senior Litigation Counsel Nanette Davis and Trial Attorney Christopher Magnani of the Justice Department’s Tax Division and Assistant U.S. Attorney Olga Zverovich of the Southern District of New York are prosecuting the case.