Mizrahi Tefahot Bank, one of the largest lenders in Israel, has agreed to pay in $195m in penalty to settle an ongoing five-year investigation in the US.
The bank admitted that it helped its US clients to conceal their income and evade taxes.
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Mizrahi Tefahot fined: Details
The bank, along with its subsidiaries, has entered into a deferred prosecution agreement (DPA) with the US Department of Justice to settle the case.
Mizrahi-Tefahot admitted that between 2002 and 2012 it was involved in schemes to help its clients evade taxes.
The schemes carried out by the bank included enabling US customers to open accounts under pseudo names and in offshore locations. Also, it allowed the clients to open accounts using non-US forms of identification.
Additionally, the bank admitted to not maintaining proper documentation and records for account openings.
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By GlobalDataOverall, the wrongdoings violated the Qualified Intermediary Agreement (QI Agreement) with the IRS.
The $195m penalty will include a fine of $118m, restitution amount of $53m, and disgorgement in the amount of $24m.
With more than 4,000 employees, Mizrahi-Tefahot is one of largest banks in the Israel.
In 2014, another Israeli lender Bank Leumi paid $400m in fines for similar investigation in the US.
