What You Need to Know
- The settlement involves about 1,608 private placement life policies.
- The deal relates to an inquiry announced in September 2017.
- Prosecutors said the company helped customers repatriate undeclared assets through a sham death payout.
Swiss Life Holding AG has agreed to pay about $77 million and help U.S. federal investigators identify U.S. tax evaders to resolve a criminal case involving use of private placement life insurance.
Officials at the U.S. Department of Justice announced the deferred prosecution agreement (DPA) with Swiss Life Friday.
Swiss Life confirmed, in a written comment on the announcement, that it has reached a resolution with the Justice Department concerning the inquiry.
The agreement involves an inquiry into prior business with U.S. clients that was announced in September 2017, and the $77 million payment is in line with an estimate Swiss Life put in a 2020 earnings release that was posted in March, the company said.
“Swiss Life is now focused on fulfilling the requirements under the resolution and successfully concluding the DPA,” the company stated.
Justice Department officials allege that Swiss Life presented use of private placement life insurance policy “wrappers,” or large life insurance policies custom-tailored to suit specific customers’ needs, as vehicles that wealthy people could use to hide stocks and other assets from the IRS.
Swiss Life began marketing private placement life insurance in that fashion around 2008, when changes in Swiss banking laws reduced Swiss banks’ ability to hide U.S. clients’ accounts from U.S. law enforcement authorities, officials said in the agreement announcement.
Taxpayers could use the private placement life wrappers to hide assets because Swiss Life would be identified as the owner of the assets.