Zurich-based insurer Swiss Life Holding has agreed to pay around $77.4m to settle allegations of helping affluent people in the US dodge taxes.
The firm agreed to a three-year Deferred Prosecution Agreement (DPA) with the US Department of Justice (DoJ) to resolve charges of conspiring with US taxpayers and others to hide over $1.45bn in offshore insurance policies.
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This includes over 1,600 insurance wrapper policies as well as associated policy investment accounts in banks.
The charges are against Swiss Life Holding, Swiss Life (Liechtenstein), Swiss Life (Singapore), and Swiss Life (Luxembourg).
The entities have agreed to accept responsibility for their criminal conduct as part of the DPA.
The DPA also calls the insurer to refrain from future criminal conduct and improve corrective measures.
Furthermore, it requires the firm to reveal information relating to accounts closed between 1 January 2008 and 31 December 2019 and cooperate with further probe on concealed insurance policies.
The settlement includes a $25.2m penalty, $35.8m in forfeiture along with $16.3m in restitution.
Swiss Life had already set aside the provision for the penalty in 2020.
Commenting on the development, Justice Department Tax Division Acting Deputy Assistant Attorney General Stuart Goldberg said: “Swiss Life today is held responsible for creating and marketing specially designed insurance products to U.S. tax evaders seeking a new way to hide their offshore assets, in light of heightened Justice Department and IRS tax enforcement efforts.
“Financial enablers here and abroad – and the taxpayers seeking their services – should know that we will continue to identify and unmask such schemes.”
Earlier this year, American International Group (AIG) was fined $12m for flouting insurance laws in New York.
The company agreed to pay the penalty after a New York State Department of Financial Services (DFS) investigation found that a subsidiary of the company conducted insurance business in New York without a licence.
