Former Swiss Executive Pleads Guilty to Tax Fraud Conspiracy

A Swiss national pleaded guilty today to conspiring to defraud the United States for his role in a scheme to help high-net-worth U.S. taxpayers conceal their income and assets in offshore accounts.

According to court documents and statements made in court, Rolf Schnellmann was the former head of Allied Finance Trust AG, a Zurich-based financial services company and a subsidiary of the Allied Finance Group in Liechtenstein. From approximately 2008 to 2014, Schnellmann and his co-conspirators defrauded the IRS by concealing income and assets of high-net-worth U.S. taxpayer-clients in undeclared bank accounts at Privatbank IHAG Zurich AG (IHAG), a Swiss private bank. 

Schnellmann and his co-conspirators devised and implemented a scheme dubbed the “Singapore Solution” to fraudulently conceal the bank accounts of the U.S. taxpayer-clients, their assets and their income from U.S. authorities. As part of the scheme, Schnellmann and his co-conspirators conspired to transfer more than $60 million from the U.S. taxpayer-clients’ undeclared IHAG bank accounts through a series of nominee accounts in Hong Kong and other locations before returning the funds to newly opened accounts at IHAG in the name of a Singapore-based asset-management firm that a co-conspirator helped establish. The U.S. taxpayer-clients paid large fees to IHAG and others to help them conceal their funds and assets and evade taxes. 

Schnellmann was arrested in August in Italy and extradited to the United States. He is scheduled to be sentenced on July 19, 2024, and faces a maximum penalty of five years in prison, as well as a period of supervised release, restitution and monetary penalties. A federal district court judge will determine any sentence after considering the U.S. Sentencing Guidelines and other statutory factors.

Acting Deputy Assistant Attorney General Stuart M. Goldberg of the Justice Department’s Tax Division, U.S. Attorney Damian Williams for the Southern District of New York and James C. Lee, Chief of IRS Criminal Investigation (IRS-CI) made the announcement.

IRS-CI is investigating the case. Mr. Goldberg and Mr. Williams also thanked the Justice Department’s Office of International Affairs, Interpol, Italian law enforcement authorities, the Prosecutor General’s Office of Trieste and the Italian Ministry of Justice for their assistance in the extradition of the defendant. 

Senior Litigation Counsel Nannette Davis of the Tax Division and Assistant U.S. Attorney Olga I. Zverovich for the Southern District of New York are prosecuting the case.