Tax Evasion Plea
Edgar Paltzer, a lawyer called to the bar in Switzerland and the U.S. with the Zurich firm of Niederer, Kraft and Frey, pleaded guilty today in New York to conspiracy to evade taxes and faces up to five years in prison.
According to Mr. Paltzer’s indictment, the bank with whom he was associated, had over $2 billion in assets under management, 40% of which belonged to U.S. taxpayers. Also according to the indictment, Paltzer instructed clients not to disclose offshore funds and gave them advice on how to avoid anti-money laundering reporting requirements, both to avoid detection by the IRS.
Mr. Paltzer has agreed to testify for the U.S. government in respect of his former clients, which raises interesting questions of both confidentiality and privilege.
A U.S. court also ordered that five vaults controlled by Mr. Paltzer with UBS AG in Zurich be sealed for an interim period while the IRS investigates to whom they are registered.
Since the IRS began its crack-down on tax evasion, more than 35 firms or advisors have been criminally charged with conspiracy in relation to tax evasion or money laundering, sometimes both.