A married couple from Englewood, Florida, has been charged with tax evasion after using offshore bank accounts to conceal millions of dollars in assets and income.
According to the indictment, Drs. David Leon Fredrick and Patricia Lynn Hough conspired with each other and with Beda Singenberger, a citizen and resident of Switzerland, and a UBS banker to defraud the IRS.
The indictment alleges that the couple used nominee entities and undeclared bank accounts at UBS and other foreign banks to conceal assets and income from the IRS, including the sale of real estate associated with the medical school on Saba for more than $33 million.
The real estate was sold in 2007, and the funds were deposited into one of their undeclared accounts in the name of a nominee entity. The couple then used the funds to purchase an airplane, two homes in North Carolina, and a condominium in Sarasota, Florida. Fredrick also transferred more than $1 million to his relatives.
The couple was also charged with four counts of filing false tax returns for 2005, 2006, 2007, and 2008. The indictment alleges that they filed false tax returns which substantially understated their total income and failed to report their interest in or signature or other authority over bank, securities, or other financial accounts located in foreign countries.
A trial date has not been scheduled. An indictment is merely an accusation, and every defendant is presumed innocent unless and until proven guilty.
The conspiracy charge carries a maximum potential penalty of five years in prison and a $250,000 fine. The false return charges each carry a maximum potential penalty of three years in prison and a $250,000 fine. This case is being prosecuted by Trial Attorney Caryn Finley of the Justice Department’s Tax Division and was investigated by IRS – Criminal Investigation.
David Leon Fredrick and Patricia Lynn Hough, both married doctors, served on the Board of Directors of two Caribbean-based medical schools – one located on Saba, Netherlands Antilles, and one located on Nevis, West Indies. Fredrick had an ownership interest in the medical school on Nevis until 2007.
Defendant: David Leon Fredrick and Patricia Lynn Hough
Criminal Charges: Conspiring to defraud the Internal Revenue Service (IRS) by concealing millions of dollars in assets and income in offshore bank accounts at UBS and other foreign banks, and filing false tax returns for 2005, 2006, 2007, and 2008.
City and State: Englewood, Florida
Exact Date: Not specified in the indictment
Sentence or Outcome: Not specified in the indictment
Dollar Amounts: More than $33 million and more than $1 million
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Key Facts
- State: Federal
- Category: White Collar Crime
- Source: DOJ Press Release â†â€â€
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