A recent federal indictment of a wealthy American accused of concealing money from the IRS in foreign tax shelters may signal a large-scale legal action against HSCB. Persons familiar with the indictment of Vaibhav Dahake told the New York Times that HSBC was the unidentified international bank that advised the illegal use of tax shelters.
Federal authorities are said to be considering a legal summons intended to ascertain the degree to which HSBC was actively marketing these illegal services to clients. A similar recent summons served on UBS resulted in the disclosure of several thousand client names.
The indictment of Dahake cited a number of unidentified bankers who advised him, among other things, not to file forms with the IRS and that money transferred between British Virgin Islands accounts and Indian accounts would not be monitored or noticed by US authorities.
A lawyer for Dahake said that he perceived a connection between the indictment and the impending IRS amnesty program for tax cheats. He called the indictment a “clubbed invitation” for wealthy Americans concealing money in foreign accounts to come forward, declare their money, pay their taxes, and suffer reduced fines and penalties as part of the amnesty program.