Disbarred lawyer Kenneth Heller pleaded guilty to income tax evasion yesterday as he agreed to pay a civil penalty of $9.8 million for hiding millions in a Swiss bank. Mr. Heller, 81, admitted to opening a sham offshore corporation in 2005 and establishing a bank account with UBS AG and then parking $26.4 million in the account.

UBS AG entered into a deferred prosecution agreement with the United States in 2009 in which it admitted helping taxpayers shield money from the Internal Revenue Service. Under a plea bargain with the government, Mr. Heller, a former maritime attorney, faces up to three years and one month in prison when he is sentenced on three counts of personal tax evasion by Judge P. Kevin Castel on Sept. 27. But Assistant U.S. Attorney David B. Massey agreed that a sentence below the stipulated guidelines range was warranted.