FATCA violation underlies latest US tax and securities fraud charges

Abstract

Purpose

To explain the details and implications of a September 9, 2014 federal indictment, US v. Robert Bandfield, the first time a Foreign Account Tax Compliance Act (FATCA) violation has been charged as an “overt act” in furtherance of a tax conspiracy and securities fraud.

Design/methodology/approach

Provides background, including the enactment of FATCA and the details of the indictment; describes an undercover investigation conducted by President Obama’s Financial Fraud Enforcement Task Force; and discusses the warnings this indictment sends to the global financial community.

Findings

The indictment confirms the coordinated and aggressive tactics US law enforcement is now employing to investigate and prosecute offshore financial fraud.

Practical implications

Banks and financial service providers need to be aware of the impact of enhanced US regulatory obligations and implement appropriate compliance measures. These institutions must also remain sensitive to risks presented by unscrupulous customers. Finally, they must be ready to manage appropriately information-gathering and investigatory inquiries originating with US authorities.

Originality/value

Practical guidance from experienced tax controversy lawyers.

Citation

Fisher, M. and McManus, B. (2015), "FATCA violation underlies latest US tax and securities fraud charges", Journal of Investment Compliance, Vol. 16 No. 1, pp. 74-76. https://doi.org/10.1108/JOIC-01-2015-0008