How can the U.S. Gov't seize offshore accounts?

I watched the movie American Gangster recently (meh) and then out of curiosity did some research on Frank Lucas, the real life former crime boss Denzel Washington’s character was based upon. Lucas said in several interviews (and it’s mentioned on wiki) that at the height of his illegal activities he had more than $50 million in cash in banks across the U.S. and the Cayman Islands and owned real estate in the U.S., Bermuda, South America, and the Caribbean. Per Lucas, the U.S. government seized every penny, leaving him literally broke when he was in prison.

From this interview:

I can understand seizing real estate in the U.S. and perhaps even abroad, and certainly the IRS can do anything it wants with U.S. accounts with the right authority, but I thought that off-shore accounts were, by definition and purpose

1- often anonymous (no name attached, just numbers and bearer I.D.)

2- not subject to seizure by the U.S. or any other government

3- extremely difficult or impossible even to verify the existence of (since neither Grand Cayman and Zurich would be particularly impressed by a Federal court order)

This is certainly implied in one impeccable source I’ve read on criminals hiding money John Grisham novels.

So question: Can the U.S. government take money from off-shore accounts in the Caymans or for that matter in Switzerland, Hong Kong, Brazil, and other popular hiding places? If so, how?

It would seem to me that if the governments of these nations allowed it then the depositors would head for the hills pronto and find a nation less willing to cooperate and bankers less willing to share information.

Or is it probable that in Lucas’s case they had help in finding and accessing the money from, perhaps, his family (or even from himself in exchange for a lesser sentence)?

Of course I also doubt, but have no cite and can’t prove, that Lucas was left totally broke as he claims. When you deal with as much literal cash as he had access to, you’d have to be stupid to not have some ingenious hiding places, and nobody can do what Lucas (dominate an illegal heroin market in spite of competition from the Mafia and other syndicates) for years and years. I’d have cash and other valuables (bearer bonds/jewels/gold/etc.) hidden low tech (buried on country property, in the floorboards of houses owned through sock puppets, inside of statues donated to small town parks, etc.) or high tech under a thousand aliases of almost as many nationalities, so I’m guessing there’s probably some suitcases with his name on them around that he can open when he wants extra cheese on his Whopper.

If you were smart and thinking ahead you might have a just in case stash. But alot of the kingpins never thought they would get caught and any kind of investigation would get quashed.


Many of the notorious offshore banking locations have started to cooperate with authorities from other countries, either on a courtesy basis or subject to provisions codified in a treaty. Swiss banking secrecy, for example, has long been a nuisance to EU tax collectors, making it difficult for them to track down tax evasion. Because of this, the EU has put the Swiss government under pressure (for example by threatening to impede the flow of assets between Switzerland and the EU) to reform its legislation, and after some initial resistance, Switzerland has started to comply (article from the European Commission website, English-speaking article from a German newsmagazine). The U.S. takes a similar position, as is addressed in the former link.

I also remember reading (sorry, no cite) that nowadays Swiss banks are extremely reluctant to open new anonymous accounts. The “classic” Swiss banking account, btw, has never been fully anonymous - the bank did know the name of the client. The name simply was stored in a different file to which only the top echelons of the bank would have access. In everyday transactions, the account number was not associated with a particular name, but the bank could find it out if necessary.

Switzerland and many of the off shore centers have long been open to foreign governments when criminality is proved at a certain level.

Pretty much all of them now, IIRC. The USA and the EU can bring a lot of pressure to bear. It’s just not worth keeping all those tax-dodging and money-laundering accounts, if big governments make trouble for your legitimate account holders! Then there’s the Financial Action Task Force:,3343,en_32250379_32237295_34027188_1_1_1_1,00.html . The FATF Can really turn the screws on any government that makes money-laundering and tax-dodging easy.

For a list of countries with agreements under a Mutual Legal Assistance Treaty (MLAT) see: 404 - Page Not Found. Even Panama is on it, and most of these treaties at least allow governments to enquire about bank accounts under foreign jurisdictions. For a list of countries with additional tax treaties, see Note that even the old USSR signed up to one of these in 1973! Dictatorship or democracy, fascist or communist, all governments tend to take the same attitude when it comes to money they regard as theirs.

The only truly anonymous account was the Austrian “Sparbuch”. The accounts were opened anonymously using an unnamed, transferable passbook. No power on Earth could get your name out of the bank, because the bank didn’t know it. Anyone could walk in with a Sparbuch passbook and withdraw all the money, with no ID or checks or anything else. There was nothing to check against, the passbook WAS the account.

At their peak, there were more Sparbuch accounts in Austria than there were people! But the FATF forced Austria to change their banking laws, and on 1st July 2002, no new Sparbuchs could be issued, and old Sparbuch holders had to identify themselves before they could withdraw or deposit funds.It’s still just about possible to have an anonymous fortune in an old Sparbuch, but you have to give up your name to withdraw it. Dirty Dealing: The Untold Truth about Global Money Laundering, International ... - Peter Lilley - Google Books Start at page 11.