IRS Seeks Names of Stanford Investors Who May Have Hidden Accounts Overseas

Dec. 4, 2009 — -- U.S. officials are continuing a crackdown on Americans who evade taxes by hiding assets in offshore accounts, this time going after clients of accused Ponzi scammer Allen Stanford.

The Justice Department asked a federal court this week to let investigators seek the identities of individuals who held accounts with Stanford, the same tactic used in the UBS tax case that eventually netted access to names of 4,450 U.S. clients.

"This is another crucial step in our ongoing effort to pursue hidden offshore accounts," said IRS spokesman Frank Keith. The action, he added, "will not only help us pursue those who evade their taxes, but also aggressively identify third parties and others who assist with these illegal actions."

Papers filed in court said the IRS has reason to believe that some of Stanford's investors, now victims as Stanford stands accused of orchestrating a $7 billion fraud, may have been under-reporting income.

The Justice Department said the "IRS has evidence volunteered from a U.S. taxpayer that account statements and Form 1099s from Stanford-controlled entities did not include interest or income generated from SIB accounts or certificates of deposits."

The Justice Department is asking for permission to serve a "John Doe summons" on Ralph Janvey, the court-appointed receiver of the Stanford Group Company who took control of Stanford's books. They want Janvey to disclose the identities of Stanford's account holders so that their income disclosures can be investigated.

Janvey did not immediately return a call from ABCNews.com.

Angela Shaw, founder of the Stanford Victims Coalition that represents about 6,000 victims of the financier, told Reuters they are "shocked" with the development and don't believe the IRS will find wrongdoing.

Stanford is charged with fraud, conspiracy and obstruction in a 21-count indictment. He remains jailed while awaiting trial. If convicted, he faces a maximum sentence of 250 years behind bars. He surrendered to the FBI in Virginia in June and has pled not guilty to the charges.

Authorities say Stanford and his alleged co-conspirators engaged in a scheme to defraud investors who purchased approximately $7 billion of CDs from the Stanford International Bank, an off-shore entity based in Antigua. Stanford and his co-defendants are accused of misusing and misappropriating most of their investment assets.

The Securities and Exchange Commission previously filed a civil complaint against alleging Stanford ran a fraud promising investors impossible returns, much like Bernard Madoff's $65 billion alleged Ponzi scheme.

The IRS and the Justice Department announced in November that over 14,700 Americans have admitted to hiding assets overseas in the UBS case, under an IRS voluntary disclosure program that allows U.S. taxpayers to come clean about secret foreign bank accounts and avoid possible persecution.

The once-secretive Swiss bank sent letters to thousands of its American customers in early October, informing them "your account with UBS appears to be within the scope of the IRS Treaty Request" and that under a new agreement between the U.S. and Switzerland, UBS would provide names and account information to U.S. authorities.

In August, the two countries signed a historic agreement to obtain information from UBS to identify information on up to 4,450 accounts. U.S. officials believe the accounts could hold up to $18 billion, and they applauded the move as a major step in lifting the shroud of Swiss banking secrecy and uncovering potentially billions of dollars stored in accounts there by wealthy U.S. account holders who could be dodging U.S. taxes.

Click Here for the Blotter Homepage.