Secret Overseas Banks Accounts & Tax Evasion
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Secret Overseas Bank Accounts & Tax Evasion
Secret Overseas Bank Accounts & Tax Evasion: While it is not everyday that the IRS & US Government pursues criminal indictments and prison sentences for matters involving offshore noncompliance, recently a Florida man was sentenced to two years in prison for failing to report foreign bank accounts. In the case of Dusko Bruer, the US Person Taxpayer intentionally failed to file tax returns or pay income tax to the US Government. Instead of receiving a salary or distributions and then paying tax — the government alleged he directed money into foreign bank accounts, which were then used to fund his own personal expenses, investments, etc. Taxpayer had opened several secret overseas bank account in countries such as Croatia, Germany, Serbia and Switzerland — to the tune of nearly $8 million. In addition, the government alleged the Taxpayer owed $3M in taxes.
Florida Man Sentenced for Evading Taxes on Millions in Secret Offshore Bank Accounts
As provided by the Justice Department
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A resident of Palm Beach County, Florida, was sentenced to 24 months in prison for not reporting his foreign financial accounts from 2006 through 2015 and for willfully evading the assessment of millions in taxes from 2007 through 2014.
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According to court documents, from 2003 through 2009, Dusko Bruer owned and operated a company that bought U.S.-made agricultural machinery and parts and sold them throughout the world. Bruer’s company had numerous employees and reaped millions of dollars in annual gross receipts. Despite its success, Bruer’s company did not file employment or corporate tax returns, nor did the company pay employment or income taxes. Furthermore, from 2003 forward, the company never paid Bruer a salary. Instead, Bruer directed that millions of dollars from the company’s bank accounts be used to pay his personal expenses, to make foreign investments, and to transfer funds to his family members.
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To conceal his income from the IRS, from 2006 through at least 2015, Bruer owned and controlled bank accounts held at financial institutions in Croatia, Germany, Serbia, and Switzerland, which he did not report, in violation of the law. Between 2007 to 2011 alone, Bruer transferred $5.8 million from domestic accounts to these foreign financial accounts. In total, between 2007 and 2014, Bruer did not report receiving $7,726,213 in income, nor did he pay $2,789,538 in taxes. Bruer used his unreported offshore accounts to fund his lifestyle, including the purchase of foreign property, a $1,350,000 yacht, and a 3,200 square foot home in Lake Worth, Florida, with 100 feet of frontage on the Intracoastal Waterway for $1,650,000.
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In addition to the term of imprisonment, Senior U.S. District Court Judge Kenneth A. Marra ordered Bruer to serve two years of supervised release and to pay approximately $2,789,538 in restitution to the United States.
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Acting Deputy Assistant Attorney General Stuart M. Goldberg of the Justice Department’s Tax Division and Acting U.S. Attorney Juan Antonio Gonzalez for the Southern District of Florida made the announcement. Further, Acting Deputy Assistant Attorney General Goldberg and Acting U.S. Attorney Gonzalez would like to thank the Ministry of Justice of the Republic of Croatia for their assistance in this matter. The Justice Department’s Office of International Affairs provided significant assistance.
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The IRS-Criminal Investigation is investigating the case.
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Senior Litigation Counsel Mark F. Daly of the Tax Division and Assistant U.S. Attorney Aurora Fagan of the Southern District of Florida are prosecuting the case.
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Additional information about the Tax Division’s enforcement efforts can be found on the division’s website.
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Golding & Golding: About Our International Tax Law Firm
Golding & Golding specializes exclusively in international tax, and specifically FBAR penalties and IRS offshore disclosure & compliance.
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