According to a criminal filing from the federal court in Manhattan and the DoJ, Bernard Kramer, 83, pleaded guilty of holding an undeclared Swiss bank account in Switzerland as well as an undeclared account in an Israeli bank in Israel. Kramer used the coded phrase ‘Hot Lips” to refer to his undeclared account. The assets held at at the Swiss bank (c.a. $1m) were transferred to the Israeli bank in 2010.
As the US laws require citizens and residents to file annual IRS reports disclosing domestic and foreign income. It is mandatory disclose any foreign account with an aggregate value of more than $10k in any calendar year.
Kramer agreed to cooperate with government investigators and pay a civil penalty of $588,042 along with past due taxes. He potentially faces a maximum eight-year prison term at a Manhattan federal court sentencing set for Feb. 6
More than 45,000 US citizens have paid an estimated $6.5 bn in back taxes, interest and penalties under the voluntary disclosure program.