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January 6, 2010

Cranky convicted corporate cooperator complaining about prosecutors

This Bloomberg report, which is headlined "Ex-UBS Banker, Informant Birkenfeld Seeks Probe of Prosecutors," provides the latest news on a white-collar case that has the feds and their corporate cooperator in a fight.  Here are the details:

Bradley Birkenfeld, a key informant in a U.S. investigation of offshore tax evasion aided by UBS AG, claimed in a complaint that federal prosecutors made false statements to a judge who sentenced him to 40 months in prison.

Lawyers for Birkenfeld, a former UBS banker, claimed prosecutors made “inaccurate, misleading and incomplete” statements about him at his Aug. 21 sentencing hearing and in an interview on CBS Corp.’s 60 Minutes television show aired Jan. 3.  Birkenfeld, 44, must report to prison on Jan. 8 and can’t extend his surrender date as he requested, a judge ruled Jan. 4.

Birkenfeld asked for an internal probe in a letter yesterday to U.S. Attorney General Eric Holder and the Justice Department’s Office of Professional Responsibility, which investigates allegations of attorney misconduct.  Birkenfeld began telling U.S. authorities in 2007 how UBS helped Americans hide assets in secret Swiss accounts.  He pleaded guilty in 2008 to helping California billionaire Igor Olenicoff and others evade taxes.

“It is one thing to hold Mr. Birkenfeld accountable for wrongdoing,” Birkenfeld’s lawyers wrote. “It is another thing altogether to imprison Mr. Birkenfeld on false information, especially when he is treated far more harshly than the wrongdoers who actually profited from the illegal tax schemes that Mr. Birkenfeld disclosed.”

Justice Department spokeswoman Tracy Schmaler said in a statement that Birkenfeld pleaded guilty to conspiracy to defraud the U.S. and admitted criminal wrongdoing.  “At his sentencing in August, Mr. Birkenfeld made arguments for leniency,” Schmaler said.  “In a motion filed in December, Mr. Birkenfeld requested a resentencing hearing citing the same issues raised in his letter to the Justice Department Office of Professional Responsibility. After consideration of these issues, that request was denied by a federal judge.”...

At his sentencing hearing in federal court in Fort Lauderdale, Florida, Justice Department prosecutor Kevin Downing said the U.S. couldn’t have unraveled the bank’s “massive tax fraud scheme” without Birkenfeld’s cooperation.  Downing also recommended a 30-month term for Birkenfeld, saying he wasn’t initially truthful about Olenicoff.  U.S. District Judge William Zloch, who could have imposed as many as five years, instead gave Birkenfeld a term of three years and four months.

Olenicoff, who pleaded guilty in 2007 to filing a false tax return, got two years’ probation and paid $52 million in back taxes, fines and penalties.  Last year, six former UBS clients pleaded guilty....

The letter was sent yesterday by attorneys Stephen Kohn and Dean Zerbe of the National Whistleblowers Center in Washington.

January 6, 2010 at 09:03 AM | Permalink


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Headline No. 1: "Convict Complains About Prosecutors"

Headline No. 2: "Dog Bites Man"

Posted by: Bill Otis | Jan 6, 2010 10:56:07 AM

Great alliteration, Professor!

Posted by: Res ipsa | Jan 6, 2010 1:41:13 PM

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