Ex-UBS banker Granted Bail in Tax Fraud Case

A former UBS banker now working in Credit Suisse charged with helping American account holders hide as much as $500 million in offshore assets to avoid taxes has been granted bail by a federal court judge.  Christos Bagios who worked for UBS Bank of Switzerland was held in custody since January 26 but has now been granted bail of $500,000 corporate surety bond and $150,000 cash bond by US Magistrate judge Robin Rosenbaum.  Judge Rosenbaum also ruled in Fort Lauderdale that the prosecution has probable cause to charge Bagios of conspiring to defraud the US government by impeding the IRS.

In 2009, UBS Bank was granted a moratorium from criminal prosecution by paying a fine of $780 million to the US government for helping American taxpayers dodge taxes using their offshore bank accounts.  The bank also had to divulge details of thousands of its hitherto secret bank accounts belonging to wealthy Americans suspected of tax evasion.

Judge Rosenbaum made public a criminal complaint that Bagios helped between 100 and 150 American taxpayers evade taxes through their bank accounts.  However, Bagios himself maintained that he was not aware he was abetting tax evasion, according to Arthur Greenspan, his lawyer.  Judge Rosenbaum ordered that Bagios undergo electronic monitoring and remain in South Florida.  Bagios, 45 is a Greek citizen residing in Switzerland.  He joined Credit Suisse Private Advisors in 2009 after a career spanning 15 years at UBS Bank.

Bagios conspired with another UBS banker, Renzo Gadola who pleaded guilty to conspiracy in December.  According to Gadola, he and Bagios were ‘part of a team of UBS bankers who serviced hundreds of undeclared accounts at UBS owned and controlled by US taxpayers’.  17 of those clients stepped forward and disclosed their accounts to the IRS in order to escape prosecution.

Bagios’ lawyers pressed for his release on the grounds that the government did not grant him a hearing to indict him within 30 days of his arrest.  But Judge Rosenbaum declined to release him after a prosecutor said the two sides were in negotiations together.

According to the criminal complaint the judge made public, Bagios had helped a California businessman named Bernard Goldstein hide his assets in an account in Panama.  Goldstein was also charged and has not entered a plea yet.  The complaint also alleges that Bagios met other American taxpayers to discussed their undeclared accounts.