Maybe snitching can be more profitable than some of us might think. A former banker with UBS was awarded a whopping $104 million from the IRS for reporting information on how wealthy bankers were hiding their money. The award is the largest in US history.
Bradley Birkenfeld opened the door for a settlement between the US government and UBS. The bank agreed to pay the IRS $780 million in penalties, and they also turned over a great deal of information to the federal government about their clients.
The IRS has offered these rewards for quite a while and even give amnesty to those who present the information. Over 35,000 Americans have participated in the program, and this has netted $5 billion in back taxes and penalties.
“The IRS believes that the whistleblower statute provides a valuable tool to combat tax non-compliance, and this award reflects our commitment to the law,” the IRS said in a public statement.
The law says that the whistleblower can get 30% of the money they uncover. Birkenfield did go to prison for his part in the tax evasion scheme. He is now seeking a pardon from President Obama. Prosecutors say that although he shared valuable information, he was not honest about his own role in the process.
“Often times, the best people to tell you about a fraud are people whose hands aren’t entirely clean,” said Shane Stevenson, who represents whistleblowers. “You want people who have made some bad decisions in their lives to turn and make some good decisions, and putting out a financial reward is a way to incentivize that.”
Birkenfeld released this statement after getting his reward:
“This is the day I thought would never come. I single-handedly transformed centuries of illicit Swiss private banking practices, but I paid a huge price for being the only person to have the courage to come forward.”