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New York Times – The United States is building criminal cases against more than 150 American clients of UBS as part of a crackdown on tax evasion now made easier by a deal over access to secret account information.
U.S. prosecutors gave their first official confirmation of the initial number of criminal investigations in a filing on Tuesday with a federal court in Fort Lauderdale, Florida. The number of criminal probes is widely expected to mushroom soon, Reuters reported.
In the same court document, the prosecutors requested a sharply reduced prison sentence for ex-UBS banker Bradley Birkenfeld, a key informant in the ongoing U.S. prosecutions of wealthy American clients of UBS.
Herald Tribune – A federal judge extended a freeze on the assets of Sarasota’s Arthur G. Nadel on Tuesday, but failed to include other partners — a measure some investors with the accused hedge fund swindler have been pushing for aggressively because Nadel shared $95.5 million in incentive fees with other Scoop Management Inc. principals.
Nadel did not contest U.S. District Judge Richard A. Lazzara’s order freezing personal and business bank accounts, property and other assets Nadel controls solely or with others, so a hearing scheduled for today was canceled.
Investors like Fort Lauderdale’s Louis Paolino Jr., who is out $5.8 million since the Jan. 14 implosion of the six funds Nadel managed, had hoped the hearing might shed light on why the U.S. Securities and Exchange Commission was not seeking to include Nadel partners Neil or Chris Moody in the freeze.
Politico.com- Sometimes in Washington, stealth is more important than strength.
In recent years, hedge fund managers, who oversee those secretive and lightly regulated pools of billions of dollars of investment capital, have gotten increasingly worried about whether Washington will change tax rules for offshore investors.
Many hedge funds set up subsidiaries in the Cayman Islands and other low-tax locales so their investors can pay lower taxes on a certain amount of their activity. If Congress were to make a grab for that money by changing the tax rules governing the hedge funds, it could generate hundreds of millions of dollars in new taxes at the hedge funds’ expense.
