Jack Townsend, on his Federal Tax Crimes Blog writes about a US Taxpayer in the process of expatriating and renouncing his US citizenship who was indicted by DOJ. His post begins as follows:
A reader just alerted me that I had overlooked a significant item of interest to readers of this blog. On March 5, 2020,, DOJ issued the following press release: Founder of Russian Bank Charged with Tax Fraud: Allegedly Concealed $1 Billion in Assets and Income when Renouncing U.S. Citizenship, here.
Key excerpts from the release are:
According to the indictment, Oleg Tinkov was the indirect majority shareholder of a branchless online bank that provided its customers with financial and bank services. The indictment alleges as a result of an initial public offering (IPO) on the London Stock Exchange in 2013, Tinkov beneficially owned more than $1 billion worth of the bank’s shares. The indictment further alleges that three days after the IPO, Tinkov renounced his U.S. citizenship – a taxable event requiring Tinkov to report to the IRS the constructive sale of his worldwide assets, report the gain on the constructive sale of those assets to the IRS, and pay tax on such gain to the IRS. Although Tinkov allegedly beneficially owned more than $1 billion of TCS shares at the time of his expatriation through a British Virgin Island structure, the indictment charges that Tinkov filed a false 2013 tax return with the IRS that reported income of less than $206,000, and a false 2013 Initial and Annual Expatriation Statement reporting that his net worth was $300,000.
If convicted, Tinkov faces a maximum sentence of three years in prison on each count. He also faces a period of supervised release, restitution, and monetary penalties.
Posted by Lewis J. Saret, Co-General Editor, Wealth Strategies Journal.