More than ever, it appears the best alternative for taxpayers with undisclosed bank accounts is to enter into the IRS 2011 Offshore Voluntary Disclosure Initiative (OVDI).  But time is quickly running out to take advantage of the OVDI – the deadline for entering the “amnesty” program is next week.  The OVDI may well be the last chance for U.S. taxpayers with undisclosed offshore accounts to benefit from pre-determined penalties and reduced criminal exposure, but only if the taxpayer comes forward before the deadline of August 31, 2011.

Many Indian Americans that have either heard of or have entered into the 2011 OVDI know of the outrageously high civil penalties they could face by maintaining undisclosed foreign bank accounts; now, these Indian Americans are taking action with the U.S. Government to lessen their penalties.

Recently HSBC India has mandated that all ties with U.S. Clients and anyone associated with U.S. persons are to be severed.  Due to heightened pressure by the U.S. government into banks such as Credit Suisse and UBS, HSBC India is taking preventative action in order to limit current investigations by U.S. authorities.  The branch has issued letters to all of its U.S. clients informing them of their recent change in client structure, that is they do not want U.S. clients. 

Credit Suisse has long assured their clients that they will not suffer the same fate as its rival Swiss counterpart, UBS, but it seems those assurances are not so sure.  On July 14, 2011, Credit Suisse received a formal letter from the U.S. Department of Justice, stating that the U.S. agency has opened an investigation against the bank for improper offshore banking practices.

A New York lawyer, Kenneth Heller, admitted hiding more than $26.4 million at Swiss bank UBS AG. He is the sixth person to plead guilty to criminal charges of tax evasion out of seven charged in the last few months.