A man who said he fled Nazi Germany as a teenager was sentenced to three months of house arrest after pleading guilty to hiding $5.7 million from U.S. tax authorities using Swiss bank accounts at Credit Suisse Group AG (CSGN) and Wegelin & Co.,
Jacques Wajsfelner, 83, admitted in August that he failed to file Foreign Bank and Financial Accounts Reports resulting in more than $419,000 in tax evasion. His lawyer yesterday asked for a sentence of two years’ probation, saying Wajsfelner placed his money in Swiss accounts in reaction to having post-traumatic disorder after having lived under the Nazis.
Wajsfelner was born in Germany and left in his teens, according to his attorney, Jeffrey Denner. He became a U.S. citizen and worked in real estate and advertising in New York and Boston, the lawyer said.
“This was as a result of his overriding irrational fear, that this is going to happen again,” Denner told U.S. District Judge Naomi Reice Buchwald yesterday before she imposed sentence. “When he was a child, the Germans took their money and they lost everything. He thought that this was an insurance policy. It wasn’t rational.”
Assistant U.S. Attorney Daniel Levy told the judge that some period of incarceration or loss of liberty was mandated because of the length of time Wajsfelner, who has a net worth of $14 million, evaded taxes and because he lied to agents with the Internal Revenue Service in September 2011.
Buchwald said she didn’t think a prison term was necessary, citing factors including Wajsfelner’s age. She sentenced Wajsfelner to serve a total of six months of supervised release, including the three months of house arrest, and pay a fine of $20,000. He previously agreed to pay a civil penalty of more than $2.8 million.
Denner had submitted a report by Roger Gray, a forensic psychiatrist, who said Wajsfelener committed his crimes, “not to evade taxes but to have an anchor.”
Wajsfelner “described the life-long and pervasive fear of what governments could do to people and the need for ‘a safety net,’” Gray wrote. The defendant told the psychiatrist that, “If my mother had had money in a Swiss bank, my brother and I could have stayed in Switzerland.”
The case is U.S. v. Wajsfelner, 12-cr-00641, U.S. District Court, Southern District of New York (Manhattan).
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