The U.S. Attorney’s Office sued Heinz Gentges last month, citing the Bank Secrecy Act, a law enacted to combat offshore bank accounts that are used for tax evasion and abusive tax schemes.
Gentges had two accounts at Union Bank of Switzerland (UBS).
“I would like to avoid disclosure of my identity to the U.S. Internal Revenue Service,” Gentges allegedly instructed UBS in a statement he signed when opening an account in 2001.
The Bank Secrecy Act requires anyone who has a foreign financial account with more than $10,000 to file a disclosure form annually.
Gentges also told UBS to retain his mail, rather than forward it to his address in Hawthorne, according to the complaint written by Assistant U.S. Attorney Samuel Dolinger. Gentges retrieved the mail on trips to Switzerland, and he authorized the bank to destroy any mail he did not take with him.
By the end of 2007, one account had a balance of more than $1.5 million. Another account had $448,975. The complaint does not identify Gentges’ work or sources of income.
In 2007, a UBS banker broke the strict Swiss banking secrecy laws and tipped off the U.S. Department of Justice to practices that were helping thousands of wealthy Americans evade taxes.
By mid-2008, the FBI was actively investigating UBS. A U.S. Senate committee estimated that 19,000 Americans held UBS accounts totaling an estimated $18 billion to $20 billion in hidden assets.
The IRS sued Swiss banks to disclose names of Americans who might be committing tax evasion. UBS eventually turned over the names of about 4,500 account holders.
The bank told Gentges in September 2008 that he had to file an IRS form or close his accounts by the end of the year. Gentges, according to the complaint, instructed UBS to transfer his securities to Migros Bank, also based in Switzerland. In addition, he asked UBS to forward his mail to an address in Lyss, Switzerland.
In 2003, Gentges and his wife, Anna, had transferred ownership of their house in Hawthrone to two trusts. The alternative successor to the trusts was Michael Andrew Gentges of Lyss, Switzerland.
The IRS offered taxpayers with secret offshore accounts a chance to come clean through amnesty programs that imposed less severe penalties than usually assessed for unreported foreign assets.
In 2010, Gentges applied for informal voluntary disclosure. More than a year later, he filed the tax forms for his UBS account balances as of 2007.
In 2013, he opted out of the amnesty program, according to the complaint. The U.S. Department of the Treasury extended the deadline for assessing the 2007 penalty for two-and-a-half years. Then in late 2016, the IRS assessed $903,853 for failure to file the tax forms.
Gentges, according to the complaint, has yet to pay the penalty.
Efforts to reach Gentges for his side of the story were unsuccessful. A phone number listed in his name was not in service.
On Aug. 30, federal court issued a summons to Gentges at his Hawthorne address. However, he may no longer live there; in July, property records show, Gentges and his wife sold the home for $567,500 to a Mount Vernon couple.