By Lawyer Michael Minns
Last year we feasted and celebrated
on the courage and entrepreneurial genius of the creator and founder of
Apple, Steve Jobs. My partner Ashley switched
us to the more expensive brand last year because of the huge capital outlays
for fixing our other computers and all of the hook up problems. We were spending
$500 to $1000 a month fixing and buying new computers. The Apples all over
the office and phone systems and iPads cost an initial outlay of $12,000.
Without a dollar of repairs in the last year we have now gotten essentially
free computers - Plus no down time. Jobs risked everything over and over
again, and he was one of the geniuses who make "Made in America" (even
if it is primarily made today in China) still mean something. Jobs is dead.
He was last year's American Hero. We also had navy seals kill bin Laden last
year. One of them has a book out.
This year? The press, the government, the IRS, all have a new American Hero
- Bradley Birkenfeld. He just got out of prison. And he just got $100 million
dollars for snitching on his clients. No medals yet. No worldwide accolades
yet. His PR machine and lawyers and probably lobbyists just want his felony
taken off his record, and a few ticker-tape parades, so there will be more
heroes just like ole Bradley. Bradley made his first $100 million bucks in
three years. Actually, the IRS has paid him $104 million for snitching. His
rise to fame and fortune is faster than Jobs, faster than Gates, faster than
Buffet. He hasn't invented anything or cured cancer. He hasn't rid our country
of the public's enemy number one on a dangerous mission. His heroics?
He left Swiss Bank UBS under a cloud and then he turned them in for what
he did for them. That's hard to follow, because it sounds funny. So let's
break it down. It will still sound funny, but it will be easy to follow.
Birkenfeld worked for a big bank.
He was paid, if we believe his story, to lie to customers, lie to the US
government, and help convert honest taxpayers
into dishonest taxpayers. He got paid commissions for getting US citizens
to put their money into the Swiss Bank UBS. Just like presidential candidate
Romney, except that no one has come out and said that Romney was trying to
break the law, or in fact broke the law… and by the way… I don't
believe Romney was breaking the law or trying to break the law. I could be
wrong; but I have no evidence to believe he is a crook and as an American,
I presume he is innocent.
Then Birkenfeld snitched on all the people he converted to Swiss UBS customers,
and he gave confidential Swiss files to the US government, and he essentially
confessed that he was a criminal, and he asked for money for turning in the
bad people he had talked into being bad people.
So he was charged with a crime
based on his confession. He got a deal. The government agreed not to charge
him with ten or perhaps 4,000 crimes if he
would agree to accept the consequences of one crime. He would, instead of
facing a hundred years or more in prison, face five. Birkenfeld had lots
of lawyers in the room when he made that deal. The government said he ought
to be locked up for 30 months, out of a possible 60… but the Judge
disagreed and sentenced him to 40. And to prison he went… complaining
every bit of the way, knowing now he had 40 months exposure and not 400 or
more… and he could break his word. He could start saying he wasn't
really a bad person…only his clients were bad. In August he got out,
and this month he got $100 million dollars for snitching out his clients.
For the last year or so there have been thousands of American customers,
just like the Republican candidate, who have Swiss bank accounts. The difference
is that their bankers, lawyers, and CPA's have not yet snitched them out
and called them crooks. And that fellow citizens is the only thing separating
any American taxpayer from criminal charges. The moment your lawyer, CPA,
banker, partner, spouse, decides to snitch you out… you are in trouble.
Innocent or guilty? That really isn't an important question. In the last
12 months I represented three Steve Jobs type entrepreneurs who spent fortunes
on legal fees and accounting fees only to “not” be certain whose
side their professionals were on. Two faced prison, one just bankruptcy.
All three were previously told to give up by three-piece-suit, thick carpet
lawyers, and other experts. All three said "no." All three won.
I shudder to think how many give in. How many Steve Jobs are in jail today
because of Birkenfelders… snitches? How many are there due to bad advice
from those who work for them?
The Nazis trained kids to be snitches.
The Russians and the Chinese teach their "advocates", their lawyers, to bow down to the state. Are
we upping them all? Are we becoming a system where our advocates are our
snitches? Where snitches, essentially backstabbers, are our heroes? "Et
tu Brute", Julius Caesar said to his former best friend who stabbed
him in the back. And of course there is the famous story about Judas selling
out for a few coins. Shall we make Brutus and Judas our heroes?
The Snitch historically has been the low life criminal who turns on other
criminals so that he can get a few bucks or so he can get his sentence of
jail time reduced. The Snitch is the team player who throws the game for
the other side. As Americans we despise Snitches. As a defense lawyer, if
I were to offer someone money to testify, they would bury me and my client
under the court house steps before they took my license away and put us both
in prison. Defense lawyers can only be unethical and obstructing justice
by bribing witnesses with money; it doesn't even get to the point where we
are allowed to offer freedom as a reward. And we shouldn't be able to. By
the same token though, am I alone in being concerned that government can
buy witnesses with huge sums of money and freedom? Is the Snitch the new
hero of the American Constitution? Of course not.
Let’s say that some of the
4000 UBS clients were trying to break the law, just like the drug lords
the bankers haven't turned on, or the Nazi's
who still have money in Switzerland, or the dictators. Ok. Out of 4000 offshore
business people, perhaps some of them are trying to break the law.
But let's be clear about this.
Money is transferred offshore, Billions and Billions, every day every second
of every day… and it is for the commerce
of legal trade. When you travel to Europe or Scandinavia or anywhere else
your money is transferred into their currencies. When you buy an automobile,
even if it is "made in the US" parts of it are made offshore and
your money goes in part, offshore. When you go to wall mart you are shopping
in the streets of Shanghai. Many business people have use of foreign accounts
and don't even know it, through correspondent banks. If you use VISA or Mastercard
or American Express in Mexico or Canada your funds are moving through foreign
banks. These customers of Birkenfeld mostly had lawyers and CPAs advising
them that they were following the law, or else they wouldn't have done it.
Why take the chance? Many are being charged with not filing their F-Bar forms.
In 2005 government estimates that less than 20% of the people who were legally
required to file the F-Bar did so. Most lawyers and CPAs didn't even know
what the F-Bar was.
The form must be filed by the
controlling party of a foreign bank account, whatever that is. You file
it if you marked on your schedule B that you have
such access. What if you had the access and didn't have to file a schedule
B? That's for another day. Now here's the wonderful thing for ole Birkenfeld.
If he tells the government that all 4000 people were supposed to file the
F-Bar and they didn't, it’s their word against his… and maybe
he gets a fee for turning them in. And maybe they all pay the penalties and
hope they don't get indicted. They really shouldn't call it the F-Bar. They
should call it the FU-Bar. It would be easier to understand. No one would
forget it. Did you file your FU form? The amount of filers would jump from
20% to 90% and we would have a fair estimate of how many were actually trying
to break the law.
Did you know that if you inherit
$10,000 in a foreign account, Mexico, Canada, Europe, God forbid Birkenfeld's
old boss the Swiss UBS, and you don't promptly
file the FU form you could be indicted? Did you know that even if you aren't
indicted you still could owe more than the entire $10,000 in penalties? What
if twenty years passed and you just found out about your inheritances? What
if you were on the deposit form because your old loving Uncle put you there… he
was worried you wouldn't get the money?
I am in favor of Bradley Birkenfeld
doing a little time. After all, he broke US laws, he broke Swiss laws,
and he broke all laws of decency involving
his poor clients. And he came into the government office without a glaring
light in his eyes, without a threat, without a gun to his head, and he confessed
under oath that he was a crook, and he wanted a bunch of money for admitting
that he was a crook. If anyone belongs in prison, if anyone ever volunteered
to go there, it’s Bradley. So count me out of the legions of tear shedding,
talking heads, about how unfair it is that Bradley did some time. Bradley
the Snitch is also a jerk. This Jerk does not deserve our pity, our worship
or our money. He didn’t want to go to prison, he wanted money, hero
worship and exoneration. He got two of the four and wants the rest.
You don't have to invent anything anymore to succeed in America. You don't
have to cure polio or kill bin Laden to be a hero. All you have to do is
be a jerk.