IRS Money Laundering Investigation Comes to Singapore

Just reported in the news today, "HSBC Clients With Singapore, India Accounts Said to Face U.S. Tax Probe". The IRS is investigating possible tax evasion by American citizens through bank accounts in Singapore. This follows a major crackdown on the Swiss private bank UBS for abetting tax evasion.

Just over a year ago, yours truly pointed out the risks that Singapore faced by positioning itself as a low-tax, private banking jurisdiction. I analyzed the UBS tax fraud case, and Andy Xie's accusation of Singapore being a high-rolling money laundering center. I noted that Singapore was rushing headlong into the private banking and casino business, businesses that depend on a sustained influx of large amounts of private capital, that often comes from illegally derived sources, or that is seeking to evade taxes.

The bloomberg article notes:

Several weeks ago, Downing toured Singapore, Hong Kong and Beijing, meeting with regulators and bankers about offshore tax prosecutions. He spoke to tax lawyers at a conference sponsored by New York University on June 18.

“We just took down the largest private wealth management bank in the world,” Downing said, referring to UBS. “Do you really think we’re going to have trouble doing the next one?”