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Sunday, February 25, 2024 | Back issues
Courthouse News Service Courthouse News Service

Wells Fargo-Linked Bank Records Face Exposure

(CN) - The Internal Revenue Service can seek information about U.S. taxpayers who may hold offshore accounts in the Caribbean corresponding with Wells Fargo, a federal judge ruled.

Senior U.S. District Judge Thelton Henderson granted the John Doe summons late Monday, the same day that the United States filed its petition. It wants Canadian Imperial Bank of Commerce FirstCaribbean International Bank to divulge records of the U.S. correspondent account at Wells Fargo.

The IRS says it can use this information to identify U.S. taxpayers who hold or held interests in financial accounts at FCIB and other financial institutions that used FCIB's Wells Fargo correspondent account.

Barbados-based FCIB has branches in 18 Caribbean countries, according to a statement by IRS Revenue Agent Cheryl Kiger filed in support of the petition.

Although FCIB does not have U.S. branches, it maintains a correspondent account in the United States at Wells Fargo Bank.

Kiger told the court that U.S. taxpayers are using FCIB to help them keep their offshore accounts undetected by the IRS and not to pay U.S. federal income tax on money placed in those offshore accounts.

The agent has allegedly reviewed information submitted by more than 120 FCIB customers who participated in the IRS's Offshore Voluntary Disclosure Program. Many of the FCIB customers in the John Doe class may have been under-reporting income, evading income taxes, or otherwise violating the internal revenue laws of the United States, according to her declaration.

The Justice Department noted that a federal judge in Manhattan gave the IRS a John Doe summons in January 2013 so that it could retrieve the correspondent account records that the Swiss bank Wegelin & Co. maintains at UBS.

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