California Resident the Latest in Series of Defendants Prosecuted for Concealing Accounts at Israeli Banks
A Beverly Hills, California man was sentenced today in the U.S. District Court for the Central District of California to serve six months in prison and one year of home confinement for filing a false federal income tax return for tax year 2007, the Justice Department and Internal Revenue Service (IRS) announced.
According to court documents, Monajem Hakimijoo aka Manny Hakimi, a U.S. citizen, and his brother maintained an undeclared bank account at Mizrahi Bank in Israel in the name of Kalamar Enterprises, a Turks and Caicos entity that was used to conceal their ownership of the account. Hakimijoo and his brother used the funds in the Kalamar account as collateral for back-to-back loans obtained from the Los Angeles branch of Mizrahi Bank. Although Hakimijoo and his brother claimed the interest paid on the back-to-back loans as a business deduction for federal tax purposes, they failed to report the interest income earned in their undeclared account in Israel as income on their tax returns. In total, Hakimijoo failed to report interest income of approximately $282,000. The highest balance in the Kalamar Enterprises account was approximately $4.03 million.
Hakimijoo has agreed to pay a civil penalty to the IRS in the amount of 50 percent of the highest balance of his one-half interest in the Kalamar account. Hakimijoo is also ordered to pay a $30,000 fine.
According to court documents, in March 2013, Hakimijoo was scheduled to be interviewed by Justice Department attorneys and IRS special agents. Prior to the interview, Hakimijoo, through counsel, provided the attorneys and special agents with copies of his amended tax returns for 2004 and 2005. When asked if the amended tax returns had been filed with the IRS, Hakimijoo indicated that the returns had been filed. Shortly thereafter, the IRS determined there was no record of the amended returns being filed with the IRS. When Hakimijoo was asked to provide copies of cancelled checks to prove that the taxes reflected on the amended returns had been paid, none were provided.
U.S. citizens and residents who have an interest in, or other authority over, a financial account in a foreign country with assets in excess of $10,000 are required to disclose the existence of such account(s) on Schedule B, Part III, of their individual income tax returns. They must also file a Report of Foreign Bank and Financial Reports with the U.S. Treasury disclosing the aforementioned financial account(s).
Deputy Assistant Attorney General Ronald A. Cimino of the department’s Tax Division and U.S. Attorney André Birotte Jr.for the Central District of California thanked special agents of IRS-Criminal Investigation, who investigated the case, Senior Litigation Counsel John E. Sullivan and Assistant Chief Elizabeth C. Hadden for the Tax Division, who prosecuted the case, and Assistant U.S. Attorney Sandra A. Brown for the Central District of California, who assisted with the prosecution.
Additional information about the Tax Division and its enforcement efforts may be found on
the division website