Bradley Birkenfeld is an American banker whose whistleblowing efforts earned him a massive award of $104 million from the IRS Whistleblower Officer. Birkenfeld is also a convicted criminal who served two and a half years in prison for conspiring with a California developer to evade United States income taxes. The story of Birkenfeld is a complex one and one that is again in the spotlight due to his recent request to be allowed to return to Europe while still on probation. His story serves to highlight the importance of whistleblowers and the risks they undertake.
Birkenfeld began his banking career in the currency trading department of State Street Bank and Trust. There, Birkenfeld claims he first blew the whistle on illegal activities by approaching the FBI. No indictments were issued as a result of his information. Birkenfeld continued his career, eventually being hired at UBS in Geneva, Switzerland. There, his job was primarily to solicit Americans to move their assets to the bank, enabling them to avoid paying U.S. taxes. Though UBS was not permitted to offer investment advice in the U.S., Birkenfeld and his colleagues were instructed to do just that.
According to Birkenfeld, UBS sponsored events designed to lure wealthy Americans then acted as salesmen offering a tax haven to clients. One of their wealthiest clients was a California development who transferred some $200 million to UBS offices with Birkenfeld’s help.
In 2005, Birkenfeld learned that his and UBS’s activities violated the agreement between the bank and the IRS. He resigned and complained to UBS compliance officers as to the bank’s unfair and deceptive businesses practices. He received no response and notified the bank’s attorney as well.
Sometime later, Birkenfeld decided to contact the U.S. Department of Justice (DOJ) and inform them of the bank’s practices. He sought to recover 30% of all funds the government was able to recover in the whistleblower action and immunity from prosecution. When Birkenfeld arrived on U.S. soil, he was arrested. He pled guilty to a count of conspiracy to defraud the U.S. as a result of his activities while with UBS.
The DOJ justified Birkenfeld’s arrest by stating he did not have whistleblower status yet, and therefore could be prosecuted. The DOJ did continue its investigation into the fraud, and eventually developed a criminal case. USB agreed to pay a $780 million fine to the U.S. government in exchange for deferred prosecution. Birkenfeld was awarded $104 million for his information, which the DOJ has since admitted was critical to the success of the case.
The government was harshly criticized for its treatment and prosecution of Birkenfeld, with the many protests and actions lobbed eventually leading to his early release. Birkenfeld’s case will no doubt be instrumental to whistleblower law reforms today. Currently, Birkenfeld is seeking permission to return to Europe where he wishes to move on with his life despite his continued probation obligations. It is unclear at this time whether his request will be answered.
Barrett Law PLLC: Mississippi Whistleblower Attorneys Helping Brave Whistleblowers
Whistleblowers like Birkenfeld have saved the United States government billions of tax payer dollars. Without courageous whistleblowers like Birkenfeld, our county’s funds would continue to be lost to fraudulent activity. However, being a whistleblower is no easy task, as Birkenfeld’s case illustrates. The Mississippi Whistleblower Attorneys at Barrett Law PLLC assist whistleblowers with qui tam actions and related matters, ensuring their rights are fully protected and their efforts greatly rewarded. Call the experienced whistleblower attorneys at Barrett Law PLLC today at 1 (601) 790-1505 to schedule your free consultation.
