The whole UBS/IRS tug of war has achieved a whole new level of ridiculousness because now, Secretary of State Hillary Clinton will meet with the Swiss Foreign Minister on July 31, just prior to the deadline settlement date of August 3rd.
We’re expecting a lovely exchange of smiling, glad-handing, back-slapping, etc. but would implore with Secretary Clinton to do the right thing and get the Swiss Minister to pony up the Toblerones.
The Swiss deserve part of this blame for not seeing the genius in this offer but our American representatives in this case have not been pushing for it, deciding instead, that our need for a reformed healthcare system should motivate our Swiss friends to turn over the 52,000 American names.
The Swiss, who no doubt laugh at our bureaucratic nightmare of a healthcare system, are instead more concerned about their sovereignty and their long tradition of client confidentiality. They have vowed not to turn over any names and this doesn’t really fit in with the IRS’s plans to get billions in back taxes on the UBS accounts, hence the need to call in the big guns.
Swiss minister to meet Clinton ahead of UBS deadline [Reuters]
- Friday Footnotes: Amateur and Non-Independent Forensic Accounting Not Appreciated By Local Parks Department; KPMG Getting Dogged | 6.26.26
- Top 20 Firm Eide Bailly Gets on the Private Equity Train
- Monday Morning Accounting News Brief: PwC Gave Us a Reason to Mention GTA 6; The Bad KPMG Anecdotes Are Adding Up | 6.22.26
IRS Getting Back to Scaring People into Tax Compliance
If you’ve got a offshore bank account and are less than with it when it comes to tax compliance, it might be advisable that you talk to your accountant.
The IRS, who is becoming increasingly less cuddly under the Obama Administration, is stepping up its scrutiny of Americans with income derived from offshore accounts greater than $10,000.
However, because the Service doesn’t want to come off as a big meanie, it is giving everyone late to the game until September 23rd to file their Foreign Bank Account Report (FBAR). If you’re the type that doesn’t concern yourself with such matters, here are some things you can look forward to:
Those who have inadvertently failed to report offshore income, even just a few hundred dollars, could be subject to a $10,000-a-year penalty going back several years. For those the IRS considers willful tax evaders, it is much worse. The IRS can impose a penalty of $100,000, or one half the value of the account, whichever is greater, per year.
Those of you that have been scofflaws on your offshore accounts, don’t fret. The IRS is allowing to confess your sins and report yourselves under their “voluntary disclosure program”. However, you will still have to be investigated by the Service’s criminal division which sounds about as pleasant as a rectal exam in front of all your friends.
IRS Gets Tougher on Offshore Tax Evaders [WSJ]
Scoping | 07.20.09
• CIT Is Said to Obtain Urgent Loan to Prevent Bankruptcy – “Directors of the CIT Group, one of the nation’s leading lenders to small and midsize businesses, approved a deal Sunday evening with some of the bank’s major bondholders to help it avert a bankruptcy filing through a $3 billion emergency loan, according to people briefed on the matter.” Bullet dodged. [New York Times]
• Scam victims ‘easily persuaded’ – “The scams the OFT has been highlighting range from the so-called Nigerian or advance free frauds, to bogus lotteries, fake clairvoyants and health cures, bogus investments and crooked racing tipsters.” Nigerian emails do have a certain charming prose that is difficult to resist. [BBC]
• Sweden’s SEB bank posts 2Q loss – No doubt had some exposure to the Latvian souls brokers [AP via Miami Herald]
• Charles Schwab denies Cuomo’s fraud allegations – “Charles Schwab Corp, the largest U.S. online brokerage, denied allegations by New York Attorney General Andrew Cuomo of civil fraud in its marketing and sale of Auction Rate Securities (ARS).” Also, some less serious charges include running commercials with creepy half-human, half-cartoons moving and talking seriously about their depleted 401(k)s. [Reuters]
• Evidence shows there’s no such thing as ‘recession-proof’ jobs – Bankruptcy lawyers might be the lone exception. Good luck getting into that. [Chicago Tribune]
Review Comments | 07.17.09
• Swedbank Losses Show Deeper Troubles in Baltic – Souls as collateral in Latvia. Enough said. [DealBook]
• Citibank, BofA Results May Not Point To Recovery – Duh. [NPR]
• Fox Biz: Jorge Posada’s Wife Talks Healthcare Reform – Much more interesting perspective than say, anyone in DC [Clusterstock]
Microsoft and Yahoo Return to Shamelessly Flirting in Front of Everyone
In rumored merger talk news, apparently Microsoft and Yahoo have started playing footsie again which annoys the living crap out of us. According to Bits Blog:
A handful of top Microsoft executives are in Silicon Valley meeting with their Yahoo counterparts to try to iron out remaining wrinkles in a proposed partnership, according to people briefed on the talks who agreed to speak on condition of anonymity because the negotiations are confidential.
Get it over with you two! T. Boone Pickens isn’t cock-blocking anymore so you don’t have any excuses. We’d all really prefer if you just got down to biznass instead of flirting in front of everyone and then saying that you’re not interested in each other. Nobody is buying it.
Yahoo and Microsoft Said to Be Closer to Search Deal [Bits via DealBook]
SEC Suit on Billionaire Man-Child Tossed
Nice try losers.
In what has to be an especially shameful blow to the SEC’s confidence, a Dallas judge has tossed the civil-insider trading lawsuit against Mark Cuban.
As much as we would like to see Cuban squirm, the Judge basically told the SEC they got nada. The SEC, re-thinking its career choice, did not immediately return calls for comment.
Judge Dismisses SEC Insider-Trading Case Against Mark Cuban [WSJ]
Scoping | 07.17.09
• What’s email? – Paulson doesn’t use it, thanks for asking. Next question. [FT Alphaville]
• Bank of America Posts a Profit on Trading Gains – “Bank of America, one of the nation’s largest and most troubled banks, announced on Friday a $3.2 billion second-quarter profit, a figure that exceeded analyst expectations.” Ken Lewis will be starting happy hour a little earlier than usual on this Friday. Circa now. [New York Times]
• Citigroup profit soars on Smith Barney sale – “Citi’s profit was not driven by improved trading like other banks, and instead came from the gain on the sale of its Smith Barney unit and the increasing values of some of its riskier assets that had plunged during the credit crisis. The New York-based bank recorded an after-tax gain of $6.7 billion on the sale of a majority stake in its Smith Barney brokerage unit to Morgan Stanley.” Selling profitable assets usually ends up looking good. This should not be surprising. [AP via Miami Herald]
Review Comments | 07.16.09
• Lawmakers End Questioning Of Sotomayor – “The Senate Judiciary Committee wrapped up Thursday its questioning of Supreme Court nominee Judge Sonia Sotomayor. Republican senators asked Sotomayor again whether she would rule on cases based on her beliefs, and she assured them she would apply the law and court precedent.” [NPR]
• Donaldson, Levitt Back FASB Off-balance-sheet Rules – “An ‘investors’ working group’ co-chaired by former Securities and Exchange Commission heads William Donaldson and Arthur Levitt Jr. has called for new Financial Accounting Standards Board rules on off-balance-sheet transactions and securitizations to be implemented ‘without delay.'” Without delay to the FASB means, sometime before the next decade. [CFO.com]
• Jamie Dimon on CIT’s Troubles – Natch, he’s cool with them biting the dust [DealBook]
UBS Names Needed so We Can Pay for Healthcare Otherwise We’ll Have to Print More Money
“Rich people, I want your money.”
No, seriously. Hand it over.
We’ve covered the failure (so far) of the IRS to get UBS to name names on 52,000 Americans and we’ve heard some good suggestions but maybe chocolate isn’t what the Service is interested in.
The House passed a pricey healthcare proposal yesterday and B to the O wanted it to be “budget neutral” which means, “We’re in a deep hole you clowns. Don’t make it deeper.”
Charged with said task, they went to a cocktail party got to work and came up with a solution that they super-duper rich will foot the bill via taxes. That means, IRS, get your shit together, because Nancy Pelosi has had enough of rich people, that aren’t her, not paying their fair share of taxes. Swiss bank account holders beware, here are the gory details that you’ll be getting in on if your name gets dropped:
Under the $1.2 trillion plan passed by the Democratic-controlled House of Representatives, the wealthiest 1.2 percent of U.S. households would have to pay an additional $540 billion in taxes over the next 10 years via an income surtax of between 1 and 5.4 percent. For the super-elite, those in the top 10th of 1 percent (and presumably the type of taxpayers who have Swiss bank accounts), that works out to an additional $280,000 a year in taxes on an average annual income of $2.3 million a year, according to the Tax Policy Center.
So basically it looks as though the IRS needs to close the tax gap because…wait for it…there’s shit to pay for! We’re not slapping healthcare on the Federal Reserve credit card, no, no. Right here and now we start paying for stuff out of our own pockets. So get on these Swiss banks and get the names because they’re avoiding their patriotic duty.
Obama’s self-defeating war on the wealthy [James Pethokoukis/Reuters]
Vampire Squid, Broken Down
For you viewing pleasure, FT Alphaville has provided some illustrations so that we might better conceptualize Matt Taibbi’s labeling of Goldman Sachs as “a great vampire squid wrapped around the face of humanity, relentlessly jamming its blood funnel into anything that smells like money”, which still makes us wince.
All we’ll say is that includes Darth Vader so that makes it worth a look.
Vampire squid, illustrated edition [FT Alphaville]
Scoping | 07.16.09
• JPMorgan Earnings Soar as It Finds Profit in Slump – “Even as it weathers the worst economic downturn in decades, JPMorgan Chase on Thursday announced a $2.7 billion second-quarter profit from stellar trading and investment banking results.” BO-NUS! BO-NUS! BO-NUS! [New York Times]
• U.S. Regulators to BofA: Obey or Else – “Bank of America Corp. is operating under a secret regulatory sanction that requires it to overhaul its board and address perceived problems with risk and liquidity management, according to people familiar with the situation.” Obviously the FDIC’s idea of double-secret probation. [WSJ]
• Citi close to secret deal with regulator – Wow! What a co-inky-dink! Citi is on double-secret probation too! [FT.com]

