In what may prove to be the first of many instances, federal authorities arrested an American client of UBS for suspicion of illegal tax evasion, according to the New York Times. Steven Michael Rubinstein, a Florida accountant, was arrested on one criminal count of filing a false and fraudulent tax return
The arrest was the first in an international tax controversy that has brought the Swiss bank under scrutiny from the Internal Revenue Service. The IRS had been investigating whether the bank defrauded the tax agency in the years from 2000 to 2007 by aiding thousands of Americans in concealing nearly $20 billion.
UBS admitted to its wrongdoing in February, saying that it had indeed helped Americans hide their money; the bank paid a fine of $780 million and said that it would assist the IRS in uncovering the identities of some, but not all, of the tax cheats. The U.S. government has filed suit demanding UBS reveal the names of the 52,000 American account holders, with Swiss officials balking.
Rubinstein, whose arrest date was unspecified by the IRS, had an account with UBS between 2001 and 2008; the charge against him specifies his 2007 tax return was egregious. Rubinstein’s UBS account was worth at least $6 million, according to the IRS.