UBS escapes tax evader’s $1.7 billion lawsuit

Judge says the billionaire former client’s track record doesn’t give him the right to sue

Lying to the Internal Revenue Service (IRS) typically isn’t the best way to ingratiate oneself with the federal government and its employees. Therefore, it should come as little shock that Judge Andrew Guilford of the U.S. District Court in Santa Ana, Calif., yesterday ruled in favor of Swiss bank UBS AG in a lawsuit brought by billionaire former client Igor Olenicoff.

In 2008, Russian-born property developer Olenicoff accused UBS of fraud and conspiracy, among other charges, in regard to handling about $200 million that he kept in offshore accounts. He claimed the bank wrongfully advised him that he didn’t have to report the accounts to the IRS. Because of this, he sought $1.7 billion in damages and wanted to investigate whether Swiss banks’ clients could legally rely on their bankers’ advice on clients’ need to disclose their accounts on tax returns.

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