The United States District Court has authorized the Internal Revenue Service (IRS) to issue "John Doe" summonses, seeking information about U.S. taxpayers who may have used a network of offshore service providers to hide assets and evade taxes. This development was announced by Edward Y. Kim, Acting United States Attorney for the Southern District of New York; David A. Hubbert, Deputy Assistant Attorney General for the Justice Department’s Tax Division; and Danny Werfel, IRS Commissioner.
U.S. District Judge John P. Cronan's order allows the IRS to demand records from certain entities linked to the Trident Trust Group, a multinational organization that allegedly assisted clients in evading federal income taxes. The IRS aims to identify individuals and trusts using these services to create or control foreign assets and potentially avoid tax obligations.
Edward Y. Kim emphasized the importance of accountability, stating: “Today’s action is part of this Office’s steadfast commitment to hold accountable those who use offshore service providers to avoid paying their U.S. taxes.”
David A. Hubbert highlighted the tools at their disposal: “The Department of Justice and the IRS are committed to using the tools available to us, including John Doe summonses like the ones authorized today, to ensure that taxpayers fully meet their responsibilities.”
Danny Werfel underscored ongoing efforts against tax evasion: “U.S. taxpayers and their facilitators who hide offshore income generating activities and assets from the U.S. government are on notice that the IRS continues to prioritize combatting offshore abusive activities."
Federal law mandates that U.S. citizens report worldwide income and disclose interests in foreign accounts if they exceed specific thresholds. Non-compliance can lead to severe consequences.
Trident Trust Group operates in nearly 30 jurisdictions worldwide, providing services like creating opaque corporate structures with strict privacy laws and offering corporate directors acting on behalf of clients. These services could help conceal asset ownership and evade taxes.
The court also permitted serving a "John Doe" summons on Nevis Services Limited, a Trident Trust Group affiliate in Manhattan, targeting records from 2014 through 2023 related to potential tax evasion activities by U.S. taxpayers.
Additionally, twelve financial entities and courier services were served with summonses for records that could identify transactions involving Trident Trust Group clients suspected of avoiding or evading U.S. taxes.
Parallel actions are underway in other district courts for similar purposes against additional entities within the Trident Trust Group.
This case is managed by Assistant U.S. Attorney Anthony J. Sun from the Office’s Tax and Bankruptcy Unit.