I don’t know about you, but my image of a whistleblower is a nebbishy little bean counter. A frumpy-podgy admin who got sick and tired of watching the shenanigans of the “beautiful people.” An engineering type who still wears a pocket protector (and still knows how to use a slide rule). Someone a bit on the square side, hard working, earnest, “good.” Not in it for the do-re-mi.
And then there’s Bradley Birkenfeld.
Birkenfeld is the former UBS employer who let the IRS in on UBS’s schemes to help his fellow American citizens dodge taxes.
Mr Birkenfeld came forward in 2007 with information on how UBS helped clients hide taxable income. Some revelations were routine, others anything but: Mr Birkenfeld himself stuffed a customer’s undeclared diamonds into a toothpaste tube to move them across borders. Related charges were settled by UBS in 2009; the bank paid a fine of $780m, from which Mr Birkenfeld will get his award. (Source: The Economist)
A tax advisor who “stuffed a customer’s undeclared diamonds into a toothpaste tube to move them across borders” is some kind of tax advisor, providing some kind of customer service.
Wonder what other sorts of tricks he had up his sleeve?
Have you thought of swapping out in these Brooks Brothers and Talbots labels for those designer ones?
I believe that your granddaughter’s American Girl doll has a hollow head. You could definitely fit a string of pearls in there.
You may want to consider threading your sudoku book with $1,000 bills.
Whatever he was or wasn’t up to, quite a few changes came about after Birkenfeld put his lips together and blew:
- UBS named names, providing the IRS with info on 4,500 Americans who, while they may not have been stuffing diamonds into toothpaste tubes, were nonetheless evading taxes.
- Congress passed the Foreign Account Tax Compliance Act, which requires overseas banks to report on American-owned accounts (which impacts Americans living abroad).
- The IRS announced an amnesty program that prompted taxpayers to re-file 33,000 returns – and netted $5B in back taxes and wrist-slap penalties. (Speculation is rife that one of the re-filers may have been Romney, which definitely explains the reluctance to release his returns.)
Another aftershock? Birkenfeld’s culpability landed him in Federal prison to serve a 40-month sentence for “his role in helping a property developer dodge the taxman.” (He was released early, and is currently in a halfway house in New Hampshire.)
The hard time, of course, served him right, as he was himself a perpetrator of tax fraud, and may even have been a procurer, wooing innocents to stow their money abroad with the fin-serv version of “Hey, sailor.”
In any event, goodness was not its own reward here.
He’s being awarded a $104 million bounty.
A lot of loot, even after he divvies it up with his attorney, Dean Zerbe, who in a prior life:
...wrote the relevant legislation on informants in 2006 while serving as tax counsel to the Senate Finance Committee.
He’s still going to be pocketing a tad more than he would have made stamping license plates in the pen, or even working as a tax advisor at UBS.
Lawyer Zerbe, meanwhile, is up to his eyeballs in whistle blower cases, claiming he’s working on two dozen others, including a couple that are even larger than the Birkenfeld windfall. (I am just delighted to know that Zerbe will be able to make up for those years toiling for a pittance in the sweatshop that was the Senate Finance Committee. Nice that he can capitalize on his labor. And what a nifty way to be a job creator! Even if it did only create a job for himself and a few of his fellow whistleblower attorneys.)
In truth, I think that having laws that protect whistleblowers is a good idea. And, since they’re probably unemployable once they’ve blown that first whistle, they really do need to be rewarded.
But, as The Economist points out:
…the size of Mr Birkenfeld’s award may have perverse results. Employees now have a big incentive to report crimes to the government rather than to their employers. That may not be the best way to stop wrongdoing.
The law of unintended consequences, I guess. Just a bit of blow-back from trying to nudge whistleblowers into doing the right thing.
------------------------------------------------------------Additional source: WSJ.