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5 face criminal charges for FATCA violations

The Department of Justice recently indicted five individuals for obstruction of the Internal Revenue Service’s (IRS) administration of the Foreign Account Tax Compliance Act (FATCA). These individuals allegedly agreed to open offshore accounts without collecting required FATCA information. The agency accuses these individuals of scheming to evade reporting requirements.

As noted in a recent press release from the Department of Justice, the accused were allegedly part of two schemes:


  • Beaufort Scheme. In this scheme, an undercover agent attempted to open brokerage accounts for multi-million-dollar stock manipulation deals with Beaufort Management. The accused allegedly failed to gather required FATCA information from the undercover agent after the agent identified himself as a United States citizen.
  • Loyal Scheme. In this second scheme, an undercover agent introduced himself as a United States citizen interested in stock manipulation schemes. The agent explained his interest in opening multiple corporate bank accounts and the need to circumvent FATCA IRS reporting requirements. The individuals with Loyal Bank did not question the agent or collect required reporting information.

These two schemes are examples of the result of global monitoring efforts. Many organizations are monitoring for FATCA reporting violations. The Large Business & International is one, in addition to criminal investigations led by the United States government. The government continues to take violations of United States tax law very seriously.

Those who are reported will likely face a thorough investigation that could result in criminal charges. Those who find themselves the subject of such an investigation are wise to take prompt action. An international tax law attorney can help preserve your interests.

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