Daily Tax Update - August 1, 2016: Second Circuit Denies IRS Request for Records Relating to American's Offshore Account

Second Circuit Denies IRS Request for Records Relating to American’s Offshore Account:  Today a three-judge panel on the US Court of Appeals for the Second Circuit denied an IRS request for records pertaining to offshore accounts held by Steven Greenfield, an American implicated in tax evasion as a result of a document leak from a Liechtenstein financial institution.  In 2013, the government issued a summons for documents relating to Greenfield’s financial accounts and documents pertaining to, among things, the ownership and management of offshore entities controlled by Greenfield.  Greenfield opposed production and moved to quash the summons based on his Fifth Amendment right against self-incrimination.  The District Court for the Southern District of New York granted enforcement as to the subset of the records demanded by the summons, concluding that the existence, control, and authenticity of that subset of documents were a foregone conclusion and, as a result, under Fisher v. United States, 425 U.S. 391 (1976), any Fifth Amendment challenge must fail.  The Second Circuit vacated the district court’s order and remanded the case back to the district court, finding that the government failed to establish that it is a foregone conclusion that the requisite exercise, control, and authenticity of the documents existed at the time of the summons.


The Consequences of Brexit for UK and UK-Domiciled Foreign Banks:  The City of London is home to numerous foreign (third-country) banks which benefit from the opportunities deriving from the City’s location in the EU.  These advantages have been seized by banks from the US, Switzerland, Japan, and others, which have used the City as a gateway to provide their services in the EU internal market as the EU gradually opens various sectors to cross-border competition.  The UK’s decision to leave the EU (so-called Brexit) will have profound consequences not only for UK  banks but also for third country banks presently hosted by London.  Click here to read more. 


Steptoe Expands Tax Group, Private Client Team in New York with Zvi Hahn:  Steptoe is pleased to announce that Zvi Hahn has joined the firm’s Tax Group as a partner.  Mr. Hahn’s arrival continues the expansion of Steptoe’s private client practice in New York which welcomed partner Beth Tractenberg and of counsel Jasmine Campirides in 2015.  Click here to read the full press release.