Landmark case - the first prosecution under FATCA

Eight years after the Foreign Account Tax Compliance Act (FATCA) was enacted as part of the 2010 Hire Act, the Eastern District of New York has prosecuted an executive of Loyal Bank for wilfully circumventing the reporting requirements of FATCA.

The executive, in his former role with the bank, was approached by an undercover agent in 2017. The agent purported to be involved in stock manipulation schemes advising the bank executive that secrecy from the IRS was required for the schemes.

He opened accounts for the individual, a citizen of the United States, in an anonymous fashion, knowing that the individual was a citizen of the United States and not reporting the account holder's information as required under FATCA.

The executive was extradited from Hungary to the United States in 2018 and is now facing a jail term of up to five years. 

 



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