Indian-American jailed for tax fraud in US

New York (IANS): An Indian-American man has been jailed for six months on charges of tax fraud in the US, a media report said.

Ashvin Desai, a resident of Silicon Valley in California, was sentenced Tuesday to six months imprisonment and six months and one day of home confinement for hiding the money in foreign bank accounts, Imperial Valley News reported Tuesday citing the Justice Department and Internal Revenue Service (IRS).

A jury convicted Desai, a medical device manufacturer, in October last year of failing to report his family’s foreign bank accounts to the government on tax returns and other federal records.

The jury also found that Desai failed to disclose more than $1.2 million income generated through interest by these accounts between 2007 and 2009.

Prior to the sentencing, Desai filed with the court a document indicating that the IRS has assessed and demanded payment of a penalty from him for $14 million, the report said.

According to evidence presented in court, Desai controlled several foreign bank accounts at HSBC in India and Dubai, including accounts held in the name of his wife and children.

Desai invested the funds in these accounts in certificates of deposit, which earned interest at rates as high as 9 percent.

Desai funded these accounts by mailing cheques from the US and by transferring money from other undeclared bank accounts in Singapore and Britain to his family’s accounts in India.

Desai also sold medical devices abroad and directed that his customers wire funds directly to his undeclared HSBC India account.

Between 2007 and 2009, Desai paid approximately $17,000 in taxes but he additionally owed over $300,000 in taxes to the IRS on his unreported interest income.

Evidence at trial also demonstrated the steps Desai took to conceal his family’s foreign accounts from the government.

In addition to failing to report his accounts on tax returns, Desai also directed the bank not to mail bank statements to his house.