Tweet
Visa/Offhore Banking Crackdown
The following was an article by the AP on March 28, 2002:
Judge OKS IRS Visa Record Summons
By CURT ANDERSON
.c The Associated Press
WASHINGTON (AP) - The IRS reasonably suspects people are evading taxes by using Visa cards issued by foreign banks, a federal judge found in approving a summons for revenue agents to obtain Visa records from 30 offshore tax havens.
The Internal Revenue Service wants to examine records from Dec. 31, 1999, through Dec. 31, 2001, for Visa International credit and debit cards issued by banks or other financial institutions in Switzerland, the Cayman Islands, Bermuda, Hong Kong, Liechtenstein, Malta, Panama and more than two dozen other jurisdictions.
U.S. District Judge Phyllis Hamilton of San Francisco, in a ruling late Wednesday, agreed that the IRS had demonstrated ``there is a reasonable basis for believing'' many of these cardholders were not complying with U.S. tax laws. She granted the agency's request for a summons to obtain the Visa records.
The government estimates that 2 million U.S. citizens may hold cards from offshore banks. While the cards are not illegal, bank secrecy laws in tax-haven countries frequently enable people to hide large incomes - and escape U.S. income taxes - while using their plastic to live lavishly.
Rather than trying to crack those secrecy laws, the IRS began in 2000 using ``John Doe'' summons to obtain records directly from the card companies. The information is then used to target people for audits and prosecution for tax evasion.
The IRS already has obtained 1.7 million offshore transaction records from MasterCard International Ltd. Earlier this week, American Express Co. agreed to release similar records. Both of those cases, however, involve far fewer tax haven countries than the Visa summons.
Judge OKS IRS Visa Record Summons
By CURT ANDERSON
.c The Associated Press
WASHINGTON (AP) - The IRS reasonably suspects people are evading taxes by using Visa cards issued by foreign banks, a federal judge found in approving a summons for revenue agents to obtain Visa records from 30 offshore tax havens.
The Internal Revenue Service wants to examine records from Dec. 31, 1999, through Dec. 31, 2001, for Visa International credit and debit cards issued by banks or other financial institutions in Switzerland, the Cayman Islands, Bermuda, Hong Kong, Liechtenstein, Malta, Panama and more than two dozen other jurisdictions.
U.S. District Judge Phyllis Hamilton of San Francisco, in a ruling late Wednesday, agreed that the IRS had demonstrated ``there is a reasonable basis for believing'' many of these cardholders were not complying with U.S. tax laws. She granted the agency's request for a summons to obtain the Visa records.
The government estimates that 2 million U.S. citizens may hold cards from offshore banks. While the cards are not illegal, bank secrecy laws in tax-haven countries frequently enable people to hide large incomes - and escape U.S. income taxes - while using their plastic to live lavishly.
Rather than trying to crack those secrecy laws, the IRS began in 2000 using ``John Doe'' summons to obtain records directly from the card companies. The information is then used to target people for audits and prosecution for tax evasion.
The IRS already has obtained 1.7 million offshore transaction records from MasterCard International Ltd. Earlier this week, American Express Co. agreed to release similar records. Both of those cases, however, involve far fewer tax haven countries than the Visa summons.
Comment