Two Julius Baer bankers who stand accused of using fictitious names like «Hydrangea» and «Red Rubin» to disguise undeclared funds held by wealthy Americans traveled to the U.S. to face charges overnight.
Five years after being indicted in the U.S., Daniela Casadei and Fabio Frazzetto pleaded not guilty in Manhattan court that they helped U.S. taxpayers avoid taxes on more than $600 million with hidden offshore accounts offered by Julius Baer.
Casadei and Frazzeto, who continue to be employed by Baer, were released on a $1 million bond each, «Reuters» reported.
However, the two plan to plead guilty to the charges in another hearing on Thursday, when Baer will also set aside a separate criminal probe against the bank itself, «Bloomberg» reported, citing two sources.
«Hydrangea» and «Red Rubin»
The two bankers are in the U.S. as Julius Baer prepares to settle a criminal investigation shortly with U.S. justice officials that it helped wealthy Americans hide funds in offshore accounts to avoid tax, by paying a $547.25 million fine.
Casadei and Frazzetto were originally indicted 2011, but as Swiss citizens, weren’t subject to extradition from Switzerland to the U.S.
Banks in similar probes such as Credit Suisse have typically portrayed employees targeted by U.S. prosecutors as «rogue» bankers who acted without upper management’s knowledge. The fact that Casadei and Frazzetto are still employed by Baer indicates the bank’s support for their decision to face charges.
Prosecutors allege that while at Julius Baer, they used fictitious names like «Hydrangea» and «Red Rubin» to hide undeclared accounts, or opened them in the name of foreign relatives or sham corporate entities.
Hearing on Thursday
It was not immediately clear whether the decision by Casadei and Frazzetto to face charges in the U.S. is linked to the impending Baer settlement. A spokesman for Julius Baer declined to comment.
A spokeswoman for Manhattan U.S. attorney Preet Bharara told «Reuters» that another hearing on Casadei’s and Frazzetto’s case is scheduled for Thursday, without elaborating.
