IRS Hunts Belize Accounts, Issues John Doe Summons To Citibank, BofA
A federal judge issued an order allowing the IRS to serve a John Doe summons to reveal Americans with offshore accounts in Belize. Targets are Belize Bank International Limited (BBIL) and Belize Bank Limited (BBL). The IRS wants to know who has accounts at BBIL, BBL, and others. But the order entitles the IRS to get records of correspondent accounts at Bank of America and Citibank.
BBL, BBIL, and Belize Corporate Services (BCS)–which sells off the shelf companies–are based in Belize. But the John Doe summonses direct Citibank and BofA to produce records identifying U.S. taxpayers with accounts at BBL, BBIL, and affiliates, including correspondent accounts to service U.S. clients. Transactions in correspondent accounts leave trails the IRS can follow. The IRS obtains records of money deposited, paid out through checks, and moved through the correspondent account through wire transfers.
The IRS already knows about these entities from the IRS offshore disclosure program, OVDP. And now the IRS can ferret out depositors who didn’t step forward. It shows the push me pull you of the many ways the government has of gaining secret bank records. Whistleblowers, cooperating witnesses, the OVDP treasure trove of data and more. A John Doe summons to UBS AG produced records on the now defunct Swiss bank Wegelin & Co.’s correspondent account at UBS.
A John Doe summons to Wells Fargo sought records of the Barbados-based Canadian Imperial Bank of Commerce FirstCaribbean International Bank. The government has it down to a science. Remember, coupled with a key whistleblower, in 2008, a John Doe summons blew the lid off the hushed world of Swiss banking. A judge allowed the IRS to issue a John Doe summons to UBS for information about U.S. taxpayers using Swiss accounts. That eventually led to Americans scrambling for cover and UBS forking over names and a $780 million penalty.