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Records of 70 Companies Sought in Offshore Probe

October 16, 2002|From Bloomberg News

The Internal Revenue Service is seeking to force at least 70 companies, including Hilton Hotels Corp. and Walt Disney Co., to turn over records as part of an expanded probe into credit card holders who use offshore bank accounts to evade taxes.

The tax agency wants judges to order airlines, hotels, car dealerships and sports teams to turn over customer records so investigators can identify holders of credit cards linked to offshore accounts. The companies aren't accused of any wrongdoing, IRS officials said.

"Our goal is simple and straightforward -- identify the people who may be using these offshore cards to evade paying their taxes," IRS Commissioner Charles Rossotti said Tuesday.

The agency is broadening its probe of people buying goods or services with funds from offshore accounts. Investigators went to court Aug. 29 seeking customer records from more than 40 companies.

The General Accounting Office, the congressional auditing agency, estimates that offshore accounts are used by 1 million to 2 million U.S. taxpayers. Only 117,000 Americans disclosed they had offshore accounts in 1999, the last year for which statistics are available, the IRS said earlier.

The tax collector previously has forced credit card companies Visa International Inc., MasterCard Inc. and American Express Co. to turn over information on cardholders in Antigua, Barbuda, the Bahamas and the Cayman Islands.

A spokesman for Disney declined to comment on whether the media company would cooperate with the records request. Marc Grossman, a spokesman for Beverly Hills-based Hilton, said the hotel company has not received an IRS request.

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