U.S. lawmakers push authorities to seek extradition against Swiss residents who were charged with helping Americans evade taxes.

Our correspondent Andreas Frank reports: In an open letter, Sen. Carl Levin and Sen. John McCain, who lead the Senate’s Permanent Subcommittee on Investigations, urged the Justice Department to “at least attempt” extradition proceedings against indicted Swiss bankers. The U.S. Senators seek extradition of about 30 Swiss bankers and others who are charged with enabling offshore tax evasion and haven’t appeared in federal courts. Most of them “apparently live openly in Switzerland, having avoided trial on their alleged crimes for years,” Messrs. McCain and Levin said.

A Justice Department official said extradition proceedings would be a poor use of resources. Because aiding tax evasion is not considered a crime in Switzerland, the country is unlikely to honor U.S. extradition requests, the official said. Instead, the department is focused on other ways of pursuing tax evasion cases, the official said citing the October arrest in Italy of former UBS AG banker Raoul Weil.

Weil, who was arrested Oct. 19 after checking into a hotel in Bologna, Italy, waived extradition. Raoul Weil was released on $10.5 million bail in December after appearing in a Florida courtroom to face a 2008 indictment.

Even if the extradition request is denied, Messrs. McCain and Levin wrote, “it will inform both Switzerland and its citizens that the United States is ready to make full use of available legal tools to stop facilitation of U.S. tax evasion and hold alleged wrongdoers accountable.”

The letter is the latest criticism from lawmakers, who say they’ve grown impatient with the pace of U.S. investigations against Swiss banks. At a Senate hearing last month, Mr. McCain faulted the Justice Department for being “incredibly slow” in pursuing Swiss bankers. In 2011, the Justice Department indicted seven Credit Suisse Group AG bankers on tax evasion charges, but none had yet faced trial until very recently.

There are signs that the Justice Department is preparing to get tougher with Swiss banks. Last week, in a surprise development, former Credit Suisse banker Andreas Bachmann returned to the U.S. to face a 2011 tax evasion indictment. Mr. Bachmann admitted to helping Americans hide their assets, in exchange for leniency and being allowed to return to Switzerland before sentencing.
Senate Levin & McCain Letter

Our correspondent Andreas Frank reports:  A former Credit Suisse banker pleaded guilty to helping Americans hide money in Switzerland and agreed to cooperate with the U.S. government as it investigates banks and their employees for aiding tax evasion.

Andreas Bachmann admitted to one count of conspiring to defraud the U.S., which carries a potential penalty of five years in prison. Prosecutors agreed to recommend a reduced sentence in return for his cooperation.

In 2011, federal prosecutors accused Mr. Bachmann and seven other Credit Suisse bankers of conspiring to set up offshore accounts for wealthy Americans that hid up to $3 billion in assets, according to the indictment.
US Bachmann PressRelease
Related Reports:

A nominee director is someone who is renting his or her name to hide the beneficial owner by taking the position on paper of the company’s directors. The term of straw man or front man has been used to describe someone who is acting as the nominee. Legally, according to the incorporation documents, the nominee is responsible for the company or entity. In addition, if it is the case of a nominee that is also listed as the nominee shareholder, then they in effect also have the related ownership responsibilities as well.

The basic function of the nominee director is to shield working executives of other companies from the public disclosure requirements. It is designed to help a person who would rather not disclose their interest or association with a given corporate body. Anyone performing a company search on a company with a nominee director would be unable to discover in whose name the nominee director was registered.

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Our correspondent Andreas Frank points out:

In its 2014 International Narcotics Control Strategy Report, the US State Department is updating the list of major money laundering countries and jurisdictions around the world.

Major Money Laundering Countries in 2013 are:

Afghanistan, Antigua and Barbuda, Argentina, Australia, Austria, Bahamas, Belize, Bolivia, Brazil, British Virgin Islands, Burma, Cambodia, Canada, Cayman Islands, China, Colombia, Costa Rica, Curacao, Cyprus, Dominican Republic, France, Germany, Greece, Guatemala, Guernsey, Guinea-Bissau, Haiti, Hong Kong, India, Indonesia, Iran, Iraq, Isle of Man, Israel, Italy, Japan, Jersey, Kenya, Latvia, Lebanon, Liechtenstein, Luxembourg, Macau, Mexico, Netherlands, Nigeria, Pakistan, Panama, Paraguay, Philippines, Russia, Singapore, Somalia, Spain, St. Maarten, Switzerland, Taiwan, Thailand, Turkey, Ukraine, United Arab Emirates, United Kingdom, United States, Uruguay, Venezuela, and Zimbabwe.

A major money laundering country is defined by statute as one “whose financial institutions engage in currency transactions involving significant amounts of proceeds from international narcotics trafficking”.

However, the complex nature of money laundering transactions today makes it difficult in many cases to distinguish the proceeds of narcotics trafficking from the proceeds of other serious crime.

This year’s list of major money laundering countries recognizes this relationship by including all countries and other jurisdictions whose financial institutions and/or non-financial businesses and professions or other value transfer systems engage in transactions involving significant amounts of proceeds from all serious crime.

The report which describes the steps taken during the previous year by the governments of nearly 90 countries, to reduce illicit narcotics production, trafficking, and use, as well as money laundering and financial crimes, said that the “complex nature of money laundering transactions today makes it difficult in many cases to distinguish the proceeds of narcotics trafficking from the proceeds of other serious crime.

The United States has named several Caribbean Community (CARICOM) countries as major money laundering states whose financial institutions engage in currency transactions involving significant amounts of proceeds from international narcotics trafficking.

Germany:

The US State Department urged Germany again to become a party to the UN Convention against Corruption.  Germany is finally ready to sign UNCAC.

On February 21, 2014 the German Bundestag 582 against 7 for German regulations to stop bribery of parliamentarian. The issue is the last major obstacle to Germany’s ratification of the United Nations Convention against Corruption (UNCAC). Germany is expected to ratify UNCAC before the summer.  It has taken 11 years and three different governments to finally reach this breakthrough.

International Narcotics Control Strategy Reports:
Drug and Chemical Control
Money Laundering and Financial Crimes

Note: Banks are not the only financial institutions money laundering.

Why Dubai’s first conflict gold audit never saw the light of day

Our correspondent Andreas Frank points out. Dubai has long had a reputation as a destination for African gold tainted by conflict and a hub for smuggling through the Middle East and Asia. A report by Global Witness provides a rare glimpse into how the city’s bustling gold trade works – and how local regulators and auditors allegedly tried to cover up at least one instance where supply-chain due diligence was lacking.

At the center of the report, based on documents handed to Global Witness by an Ernst & Young whistleblower, lies a gold refiner called Kaloti Jewellery Group. The company is run by the Jordanian Kaloti family, who have a refinery near Dubai and are building another capable of processing up to 2,000 tons of gold and silver a year, making it the largest such facility in the world.

Gold trading and refining seem to pose a high money laundering risk. On November 4, 2013 a Swiss gold refiner was accused of money laundering
Kaloti case lifts curtain on Dubai Gold Trade
City of Gold  Why Dubai’s first conflict gold audit never saw the light of day
Dokuments

Kaloti suffers reputation damage