A Los Angeles man pleaded guilty Monday to failing to file required paperwork which would have disclosed more than $1 million hidden in offshore accounts.
Ben Zion Birman faces up to five years in federal prison, as well as a period of supervised release, restitution and monetary penalties, when he is sentenced Dec. 10.
Birman failed to file a 2010 Foreign Bank Account Report with the Department of Treasury, despite having over $1 million in Bank Leumi accounts in Israel, according to the U.S. Department of Justice.
In an effort to further hide his money, Birman instructed Bank Leumi to hold bank mail from delivery to the United States, and obtained access to his offshore funds through the use of loans designed to enable borrowers to tap their concealed accounts, prosecutors said.
The lending arrangements permitted Birman to have funds issued by Leumi’s U.S. branch that were secretly secured by funds in his undeclared accounts in Israel, prosecutors said.
In December 2014, Bank Leumi entered into a deferred prosecution agreement after the bank admitted to conspiring from at least 2000 until early 2011 to aid and assist U.S. taxpayers prepare and present false tax returns by hiding income and assets in offshore bank accounts in Israel and other locations around the world.
Under the terms of the deferred prosecution agreement, Bank Leumi paid the United States a total of $270 million and continues to cooperate with respect to civil and criminal tax investigations.
“The Department of Justice is committed to vigorously investigating and prosecuting offshore account holders who maintain undeclared accounts and willfully ignore their U.S. reporting and tax obligations,” said Principal Deputy Assistant Attorney General Zuckerman.