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Miami • The Internal Revenue Service ended the legal action Tuesday that forced Swiss bank UBS AG to disclose thousands of account holders suspected of cheating on U.S. taxes, a landmark case the IRS commissioner called only the beginning of a global offshore tax evasion probe.
"This is the close of what I call the first chapter," said IRS chief Doug Shulman. "We are actively pursuing a number of other banks and promoters and advisers."
Shulman declined to get into specifics about ongoing offshore tax investigations, but said: "It's not just about Switzerland, this is about multiple countries and multiple institutions."
The IRS on Tuesday withdrew its Miami federal court summons seeking identities of suspected U.S. tax dodgers at UBS after receiving more than 4,000 names as required under an August 2009 agreement that also included the Swiss government. Each of those people expect what Shulman called a "full-blown audit" and many are likely to be charged criminally.
The agreement called for disclosure of 4,450 names in total. A statement issued by the Swiss Embassy in Washington said more identities will be turned over "in the coming months" following the outcome of legal appeals in Switzerland's Administrative Court.
The case was historic, Shulman said, because it marked the first time centuries-old Swiss banking secrecy laws had been cracked.
It led to a voluntary disclosure program in which about 15,000 people came forward to disclose their offshore accounts, allowing them to pay back taxes and penalties but avoid prosecution. These cases have averaged about $200,000 each paid to the U.S. Treasury.
The IRS said it expects eventually to obtain about 7,500 once-secret accounts from UBS for scrutiny, including those provided under a 2009 deferred-prosecution agreement in which the bank paid a $780 million fine. That prosecution was dismissed last month after UBS met all of its terms.
The information gleaned from data mining of the disclosed accounts has provided the IRS with numerous investigative leads and corroborated other information, the agency said.