New Jersey businessman Harry Abrahamsen is the latest UBS client to plead guilty to tax charges.
Abrahamsen, 67, pleaded guilty Monday to failing to file a Report of Foreign Bank or Financial Accounts, or FBAR, for 2005. He admitted that he concealed over $1 million in Swiss bank accounts.
Abrahamsen also failed to report his account at UBS AG in Switzerland on his individual income tax return for 2005 and failed to report a second account in his daughters name. In addition, Abrahamsen failed to report income earned in the UBS bank accounts. The UBS accounts, originally opened in 1992, were transferred to the name of Primrose Properties S.A., a nominee Panamanian corporation, in 2000. Abrahamsen established Primrose in early 2000 with the help of a Swiss lawyer and Swiss banker, in order to hide the accounts from the IRS.
Abrahamsen also admitted that he funded the UBS accounts with approximately $1.3 million in false and inflated expenses paid by his pre-press printing business, SJT Imaging Inc., to a Swiss company. The inflated expenses were then deducted on SJT Imagings corporate tax returns, which allowed Abrahamsen to underreport personal income for 1999 through 2003.
U.S. District Judge Dennis Cavanaugh released Abrahamsen on a $300,000 bond pending sentencing, which is scheduled for July 27. Abrahamsen faces up to five years in prison and a fine of $250,000, or twice the amount of financial gain to the defendant or loss to the IRS. Abrahamsen has agreed to pay a civil FBAR penalty based on 50 percent of the highest balance contained in his UBS account for 1999 through 2007.
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