Kentucky Man Charged with Secret Swiss Bank Accounts Scam

A Kentucky man has been arrested and charged with maintaining secret, undeclared bank accounts in Switzerland, evading millions in taxes, and conspiring to defraud the IRS.

Peter Canale, 61, a U.S. citizen and resident of Jamestown, Kentucky, was arrested this morning at his residence and is set to be arraigned in Manhattan federal court on December 3, 2014.

According to the indictment, Canale conspired with others, including his brother Michael Canale, Swiss citizen Beda Singenberger, and Hans Thomann, a Swiss citizen who served as a client adviser at UBS, to establish and maintain undeclared bank accounts in Switzerland and hide them from the IRS.

The indictment alleges that Canale used a sham entity to conceal his ownership of the undeclared accounts and deliberately failed to report the accounts and the income generated in the accounts to the IRS.

As of December 31, 2009, one of the accounts held assets valued at approximately $789,000. For each of the calendar years from 2007 through 2010, Canale willfully failed to report on his tax returns his interest in the undeclared accounts and the income generated in those accounts.

Canale is charged with one count of conspiracy to defraud the United States, evade taxes, and file a false and fraudulent income tax return, which carries a statutory maximum sentence of five years in prison.

U.S. Attorney Preet Bharara praised the outstanding investigative work of IRS-CI and thanked the U.S. Department of Justice’s Tax Division for their assistance in the case.

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