4th person charged in UBS tax-evasion case

— -- A California businessman Friday became the fourth person charged with using an offshore account at Swiss banking giant UBS to hide funds from the IRS as federal prosecutors kept up pressure on other wealthy Americans with secret foreign accounts to come clean.

Malibu resident John McCarthy agreed to plead guilty to failing to disclose a UBS account that investigators charged he used to transfer more than $1 million in business income out of the country tax-free.

LEGAL DOCUMENTS:Criminal information | Plea agreement

McCarthy, whose business was not identified by prosecutors, admitted he deliberately ducked payment of at least $200,000 in federal income taxes on the money he sent to the UBS account he secretly controlled under the name COGS Enterprises, a Hong Kong entity.

By agreeing to plead guilty at a federal court hearing set for Sept. 14, he will face a maximum five-year prison term and $250,000 in fines, plus payment of five years of back taxes and penalties.

"Mr. McCarthy has accepted responsibility for his conduct," said defense attorney Steven Toscher. "He, like many other U.S. taxpayers, has made serious mistakes regarding the use of foreign bank accounts."

McCarthy opened his UBS account in 2003 and subsequently used it to transfer more than $1 million from his Los Angeles firm, according to the federal plea agreement filed Friday. He transferred additional funds to other UBS accounts from yet another UBS account he controlled in the Cayman Islands.

UBS actively helped him hide the funds, as bank representatives told him "a lot of United States' clients don't report their (business) income and just take it off the top," the agreement stated.

McCarthy was among roughly 250 UBS clients whose name was provided to federal authorities earlier this year as part of a federal court settlement in which the bank agreed to provide financial data for clients whose accounts bore earmarks of tax evasion.