Bank employee outs tax cheats

A bank employee in Liechtenstein has publicized a list of account holders that are using the country’s highly secretive banks to avoid paying taxes on millions of dollars (story ). Apparently, the computer technician was upset over something, downloaded the names and sold them to various countries tax agencies. He is wanted by his home country for theft.

What say yea? I am going to take the bold stance of being undecided on this one. On the one hand, few things are as infuriating as rich tax cheats, and it’s always a pleasure to see them caught. Many of these offshore banks and whatnot are little more than money laundering operations anyway.

At the same time, the stealing private info rubs me the wrong way (selling it adds a thick layer of skeeviness as well). This is a similar mentality to warrantless wiretaps and the like. Kind of the “If you’re not doing anything wrong, you have nothing to worry about” BS that gets trotted out.

I really think if he hadn’t sold the CDs of names, I might have an easier time with this. Something about that really bugs me.


Horribly unprofessional. Morally incorrect.

buuut… a bit of schadenfreude there.

Is this a new case? I heard about this a year or so ago.

I wonder where he banks? :smiley:

By selling the names he shows himself to be a bit of a schmuck himself. He did not do this out of goodness, he did it for the cash.

I don’t like it when personal privacy is violated either.

I think spilling the beans on the tax cheats was the right thing to do, but I’m unhappy that he did it the way he did. Tax cheats are every bit as pernicious as common burglars.

But he sold the information, and sold it multiple times. Had he gone to the FBI or whoever and said somehing on the lines of, “I’ve got a list of international tax cheats including Americans, but if I release it to you I will be in serious danger. What can you do for me?” and then they’d paid him a million or three, I wouldn’t have a problem.

OTOH applying free-market principles to fighting crime is an interesting concept.

If the guy sold the list of American tax cheats to Michael Mukasey, the Justice Department will prosecute only the Democrats on it.

To me, that’s the best non-crazy argument against the income tax: the fact that it necessitates all kinds of basic rights violations to enforce. Starting with you giving up the right to privacy when it comes to financial matters. The IRS is also allowed to use enforcement measures which skirt our due process rights.

The 1998 reforms went a long way to fixing the problem, but there are still some more things that need to be done.

How does one 1) earn and 2) transfer great some of money to some foreign bank without anyone noticing in the first place?

I think he was a greedy schmuck and should be arrested. If we don’t want people to be able to have that loophole then we need to negotiate some kind of banking treaty with that country, or catch the money before it leaves here.

Earning money under the table is easy. Most wealthy people are not W-2 employees. That’s how Wesley Snipes got in trouble. Actors don’t get withholding taken out of their pay, they have to figure their taxes out and pay at the end of the year. I’m not sure the studios report what they pay to individual actors either, although I could be mistaken.

As for 2), I’m not sure what the government does to find out, but I’m sure whatever it is it’s unconstitutional. Or would be if the Supreme Court hadn’t ruled again and again that no violation of rights is unjustified if it’s for revenue purposes.

If his actions were immoral, then they would have been immoral without his having earned money for them. If his actions were moral, then they were moral despite his earning money for them.

I tend to think they were moral. I think income tax is moral, and I think illegally avoiding paying income tax is immoral. He essentially performed a whistleblower function, not on his employer, but on his employers’ customers. While he might be a greedy schmuck, what he did will result in double good in the world:

  1. It will force some tax cheats to pay penalties for their crimes; and
  2. It will dissuade other tax cheats from cheating.

#2 might be a very small effect: it may be that most cheats will simply use another method for cheating. But every little thing that makes it more difficult for them is worthwhile, as long as it doesn’t violate further rights.

I do not see financial privacy as a salient right here: folks were deliberately and illegally putting their financial information in another country in order to avoid doing what they needed to do.


After thinking about it a little I conclude that the guy did the right thing. If the clients banks knowingly take part in illegal activities they can´t claim any privacy rights. Well at least they have privacy rights from unfounded probing, but if an insider sees what´s going on behind curtains is his duty to report the illegal activities, or else he becomes a conspirator on a criminal activity.

I´m not sure how the client/service provider privacy issues are handled in other areas concerning current and future criminal acts… i.e. if a lawyer is working on a case of an acused pedophile, and the client says “Sorry Bob, I have to leave now, I got myself a fresh, little boy to bang this evening; see you later”, isn´t the lawyer supposed to alert the authorities to prevent a crime?

As for selling the information, well, the bloke was going to lose his job for his actions; it may be skeeve but it sends a good message: if you have valuable information about illegal banking you won´t be left hanging in the breeze for speaking up. It will encourage other people to report similar situations.

**I do not see financial privacy as a salient right here: folks were deliberately and illegally putting their financial information in another country in order to avoid doing what they needed to do.


Why isn’t financial privacy a salient right? Is checking into our library records a greater violation of our rights than checking our financial transactions? Or listening into a phone call?

You could make a case that the right to financial privacy is trumped by the government’s revenue needs, but I’m not sure where that rationalization ends. One could just as easily say that the need to protect us from terrorism trumps your privacy rights in other respects, such as you right to check out a library book without the government knowing what you checked out.

Uuuuuh, hell yes!

Perhaps listening in to a phone call, but library records? Why would what you check out of a PUBLIC library, run by a local government, be more sacred than your finances, which are between you and your bank?

Also, how do you feel about the use of your tax returns for purposes other than revenue collection? Did you know that the Senate requested your tax return for purposes they have not revealed?

I think what he did was wrong. Selling an illegally-obtained list of clients is wrong no matter what. From the point of view of Liechtenstein, all the accounts were fully legal. Some of the holders may not have been reporting earnings to their home countries which may or may not be illegal. e.g. for citizens of the UAE there is no tax anywhere, and if I were a UAE citizen, I’d not want this schmuck knowing my financial matters.

I think this starts to run into extraterritoriality where something is legal in one country but not in others and is a slippery slope when one country’s laws start to get enforced in another. So how about enforcing US law in Saudi Arabia (of course this means enforcing Saudi law in the US)? I think not.