Credit Suisse’s offices in Germany were raided by German tax officials looking for evidence of tax fraud. According to an article by Judy Dempsey in the New York Times all 13 German branches of Swiss bank Credit Suisse were searched, and it would take weeks for German tax officials to review the seized documents. One can expect that the IRS is watching this development very closely hoping to find evidence of tax evasion, and failure to file Foreign Bank Account Reports, TDF 90-22.1 (FBARs), by U.S. citizens and residents.
It wouldn’t surprise me if the IRS were preparing to file a lawsuit against Credit Suisse similar to the one filed against UBS in the hopes of getting the names of U.S. citizens suspected of tax evasion and failure to file FBARs. If the German tax prosecutors have evidence of tax fraud committed by Credit Suisse bankers, this would add fodder to any lawsuit by the IRS.
As I keep explaining to clients with offshore bank accounts, the FBAR problem is not going away, and it’s a mistake to think that the IRS investigation of offshore financial is limited to UBS, or even Switzerland.