Since 2008, the Department of Justice and Internal Revenue Service have targeted the use of undisclosed offshore accounts to evade U.S. income taxes: entering into a Deferred Prosecution Agreement with UBS AG and a non-prosecution agreement with Liechtensteinische Landesbank AG; prosecuting a second Swiss bank, Wegelin & Co.; and bringing criminal charges against more than 100 taxpayers, bankers, and other professionals.
Since March 2009, the IRS has also offered a series of Voluntary Disclosure programs aimed at enticing taxpayers to come forward and disclose their offshore accounts. These programs combined the offer of protection from criminal charges with a settlement initiative that gave participants certainty regarding the financial penalties they would pay to rectify their past violations. To date, over 39,000 taxpayers have participated in the Offshore Voluntary Disclosure Program of 2009, the Offshore Voluntary Disclosure Initiative of 2011, and the Offshore Voluntary Disclosure Program of 2012, paying over $5.5 billion in taxes, interest and penalties in exchange for assurances they would not be prosecuted.1
