Raoul Weil, a former executive with the Swiss investment firm UBS, was extradited to the United States from Italy on Friday. Weil will make his first appearance in a United States court on Monday for allegedly helping thousands of clients commit tax evasion.
Weil was enjoying a vacation to Italy in October with his wife when they received a knock on their hotel room door shortly before 2:00 in the morning. Weil found himself confronted by Italian police officers and arrested on charged levied by the United States Department of Justice.
Americans Believed to have Committed Tax Evasion using UBS Accounts Totaling Over $20 Billion
The charges stemmed from 2008, when the Department of Justice announced that they believed Americans were hiding over $20 billion in various Swiss banks. UBS, in an effort to cooperate with the United States, released the names of over 17,000 Americans with UBS bank accounts. UBS also paid the United States a fine of $780 million.
The Department of Justice issued an arrest warrant for Weil in 2009, alleging that he had helped many of those Americans open accounts with UBS with the specific intent of committing tax evasion. In the event Weil travelled outside of his native Switzerland, he would be subject to arrest by Interpol.
Although Weil had made numerous other trips to countries in Europe since the issuance of the arrest warrant, for some reason Interpol had not taken steps to have Weil arrested until October. It is not yet clear if Interpol did not receive notice of Weil’s previous trips or simply chose not to arrest him.
However, on this trip to Italy, when Weil gave his passport to the hotel during check-in, the standard security checks against police databases identified the charges against Weil from the United States.
Weil Held in Italian Prison for Weeks Since Arrest
Since his arrest in October, Weil has been incarcerated in Dozza, an Italian prison that is presently at double its designed capacity.
“The Dozza jail is one of Italy’s most overcrowded,” said Giovanni Durante, a representative of Italy’s prison system. “There is no separation between white-collar crimes and other crimes, so the banker could be sharing a cell with a murderer or a drug dealer.”
When Weil appeared before an Italian court, he indicated that he was not aware an arrest warrant was outstanding against him from the United States. However, it is unclear how Weil could not have known about the arrest warrant, as UBS indicated they fired Weil in 2009 when the arrest warrant was announced.
Since that time, Weil has become an executive for another Swiss bank.
United States and Other Countries Seek Names of Additional Tax Evaders
Weil, 54, faces up to five years in prison if convicted on all charges. Weil’s attorney indicated that his client was looking forward to facing his accusers and that his client had not knowingly helped anyone commit tax evasion.
However, jail time may not be the primary motivation of the prosecution. There is the belief that there are thousands of additional names of Americans committing tax evasion using Swiss banking institutions, which Weil and others may be able to reveal.
“Thousands of Americans have come forward since the UBS case, but we know, from lawsuits filed in Switzerland, that there are still people out there trying to fight the disclosure of tax information,” noted Stuart Gibson, a tax attorney who worked for the Department of Justice on the UBS case.
The outcome of the United States’ pursuit of additional names will have likely implications with other nations whose citizens have likewise used the protected afforded by Swiss banks historically as a means of committing tax evasion.
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Mark has been a contributor to legal web sites related to bankruptcy, tax, and criminal law since 2011. He has an Accounting degree from Texas A&M University.