Switzerland-based private lender Wegelin Bank has pleaded guilty for its role in the US tax evading case and agreed to pay $57.8m in restitution and fines.
Wegelin managing partner Otto Bruderer has entered into the guilty plea before US District Judge Jed Rakoff on behalf of the bank, which marks the first-ever guilty plea to tax law violations by a non-US bank.
Based on its guilty plea, the Swiss bank has consented to reimburse nearly $20m in restitution to the Internal Revenue Service (IRS) as well as $22.05m in fine.
It has also agreed to pay the civil penalty of an additional $15.8m, which represents the gross fees earned by the bank on the undeclared accounts of US taxpayers.
Together with the April 2012 fine of more than $16.2m from Wegelin’s correspondent bank account, the total amount being recovered by the US stood at nearly $74m.
Manhattan US Attorney Preet Bharara said, "Today’s guilty plea is a watershed moment in our efforts to hold to account both the individuals and the banks – wherever they may be in the world – who are engaging in unlawful conduct that deprives the U.S. Treasury of billions of dollars of tax revenue."
Established in 1741, Wegelin offers private banking, asset management, and other services to clients across the globe, including US taxpayers residing in the Southern District of New York. As of December 2010, it had nearly $25bn in assets under management.