If you have or had signature authority over one or more foreign financial accounts that exceed $10,000 in value, and the foreign financial accounts were “willfully” (willfulness in the criminal context has been defined as the “voluntary, intentional violation of a known legal duty”) not disclosed on your U.S. tax return, Form TD F 90-22.1 (Report of Foreign Bank and Financial Accounts (“FBAR”), or (FinCen Report 114), you may not only be liable for all revenue and criminal statutes, you may also be criminally liable for willfully failing to file an FBAR. Under 31 USC Section 5322(a), a person who is convicted of willfully failing to file an FBAR may potentially face up to five years in prison and a $500,000 fine. In addition to criminal penalties, the Internal Revenue Service can impose willful civil penalties of $100,000 or 50 percent of the value of the undisclosed foreign financial account, whichever is more. These penalties can be assessed for each year with undisclosed foreign accounts.
The rules and defenses governing criminal FBAR cases are extremely complicated. A defense attorney must not only have a detailed understanding of criminal tax law and procedures, but must have a thorough understanding of the statute of limitations governing FBAR cases (the statute of limitations on FBAR cases differs dramatically from criminal and civil tax cases), international income tax treaties, mutual legal assistance treaties (“MLAT”), and the taxation of foreign assets. A defense attorney must understand how all these factors can give rise to unique defensive considerations. A defense attorney must also procedurally know how to timely object to a summons or third party summons to prevent the extending of the criminal statute of limitations. Having a detailed understanding of these rules can literally mean the difference between the winning or losing of a criminal case involving undisclosed foreign financial accounts.
If you are under investigation (or believe that you are under investigation) by the Internal Revenue Service or the United States Attorney in connection with undisclosed foreign accounts, you will need a team of highly qualified international criminal tax attorneys that will aggressively defend you. Our firm’s attorneys can meet the needs of individuals being investigated for not disclosing foreign financial accounts and assets on a U.S. tax return and FBARs. Most law firms assign criminal attorneys to assist clients investigated for not disclosing foreign bank accounts or assets on their tax returns who are neither experienced nor comfortable in this area. Our highly skilled international tax attorneys are experienced in tax law, international law, and criminal law. We have an exceptional record of achieving extremely favorable results in international tax and FBAR cases.