The cases that the criminal investigations unit at the Internal Revenue Service sends to the tax division have a 94 percent conviction rate, making it the highest rate of conviction in law enforcement, Rick Raven, deputy chief of IRS investigations, said March 2.
Offshore tax evasion is taking up a lot of the unit’s time, Raven told the Federal Bar Association Section on Taxation’s 36th Annual Tax Law Conference.
“It’s not just a Switzerland problem,” he said, referring to UBS, which was forced in 2009 to hand over details on more than 4,000 accounts held by U.S. taxpayers and pay steep fines to avoid prosecution for tax fraud.
More international banks are under investigation than at any time in the history of IRS Criminal Investigation, he said. More than 300 investigations of individuals with ties to international banks are underway, with IRS looking for hidden money overseas.
‘We Know Just About Everything’
The IRS has a new repository of sources about offshore accounts due to its voluntary disclosure program, in which U.S. taxpayers voluntarily disclose offshore assets. Part of that deal is that they cooperate with the government, he noted.
“By the time our special agents show up, they have done trash runs on this taxpayer, they have talked to informants, they have talked to business partners, they could have brought in an undercover [agent]. We know just about everything before we go and talk to that taxpayer,” he said.
Fraud referrals, in which IRS revenue agents refer cases to criminal investigations for possible fraud, are also yielding good results, up 38 percent so far this year compared to last year, and the number of those accepted for investigation is also rising, he said.
The complete text of this article can be found in the BNA Daily Tax Report, March 5, 2012. For comprehensive coverage of taxation, pension, budget, and accounting issues, sign up for a free trial or subscribe to the BNA Daily Tax Report today. Learn more »