Steven Michael Rubinstein is the first ex-UBS client to be sentenced for tax fraud, and today we learn he's not going to jail. The first former UBS client in the biggest tax evasion case in history is paying a fine and serving a probation sentence that includes a year-long house arrest. Outrageously, the only jail-bound person in the whole multi-billion dollar UBS scandal is the whistleblower who gave the case to DOJ, Brad Birkenfeld.
The injustice for Birkenfeld that I've diaried numerous times over the past months continues with this latest insult. (The most recent: Obama Should Put US Taxpayer Money Where His Mouth Is, Marshall Award Goes to Corrupt Prosecutors in UBS Case Rather than Whistleblower)
The U.S. would not have even KNOWN about the UBS scandal or Rubinstein but for whistleblower Brad Birkenfeld, who voluntarily came forward and blew the whistle on UBS's multi-billion dollar tax evasion scheme.
In the time I’ve posted diaries on DOJ's abhorrent treatment of Birkenfeld and the debacle that the case against UBS has become, there has been some confusion on key facts. Let's clear that up:
FACT: Birkenfeld is a whistleblower.
Birkenfeld first blew the whistle in 2006 to expose and report this scandal. Peter Kurer, UBS's Group Legal Counsel, identified Mr. Birkenfeld as the whistleblower, thanked him for bringing this to his attention and called for an investigation. What happened? Business as usual - nothing changed. So, Birkenfeld went to the DOJ and IRS in June 2007 and registered as an IRS whistleblower and gave them the entire case. And on March 4, 2009, John DiCicco, of the DOJ Tax Division, told Senator McCaskill that Birkenfeld had come forward when the Senator asked "Was there a whistleblower in this case?"
FACT: Birkenfeld fully disclosed what he knew to authorities.
Quote from DOJ on August 17, 2009 about the information Birkenfeld gave DOJ: "This substantial assistance has been timely, significant, useful, truthful, complete, and reliable."
FACT: Birkenfeld acknowledged his participation in UBS's actions from the start.
Birkenfeld has never denied his involvement at UBS, and from the very first time he contacted DOJ, he admitted his role in helping UBS's clients.
FACT: Birkenfeld did NOT come forward as part of a plea deal or just to get money.
Birkenfeld began raising concerns about UBS international banking practices internally while employed at UBS. After getting no response and resigning in Oct. 2005, Birkenfeld sent an official letter in March 2006 under UBS's company whistleblower protection policy identifying the problem. Further, Birkenfeld came forward and gave his information to the DOJ, IRS, SEC and US Senate in the summer of 2007, long before his May 2008 arrest.
FACT: DOJ attorneys told Birkenfeld they weren't interested in prosecuting him, took Birkenfeld's information, and arrested him.
See the recent Time Magazine article:
"After talking with the IRS, Justice and the Securities and Exchange Commission and appearing before the Senate — and being told on at least one occasion by DOJ officials that they were not looking to prosecute him — Birkenfeld was arrested in June 2008 as he returned from Switzerland, where he had been living for the past 13 years, to his native Boston for a high school reunion."
And our newest FACT:
The first former UBS client sentenced is given more leniency than the whistleblower who handed the government the case.
The facts speak for themselves. This is just plain wrong.