I jumped at the chance to talk to the most famous financial whistleblower in history. Private Swiss Banker Bradley C. Birkenfeld details his incredible story in Lucifer’s Banker: The Untold Story of How I Destroyed Swiss Bank Secrecy. Birkenfeld exposed a massive shell game in which his employer, the megabank UBS, hid billions for its clients, from tycoons to terrorists, from royals to rebels. The book reads like a James Bond story, only it’s all true.
In Lucifer’s Banker, you discover and then expose secrets of Swiss banking that had never been exposed before. How did you discover it, and why did your whistleblowing finally work?
My colleague made me aware of a three-page document, hidden deep within the UBS intranet. We were never informed of this document, and never trained on this document. It was authorized to be written by UBS executives and just slipped into the UBS intranet when no one was looking. My whistle-blowing succeeded because I strategized: I was fully determined to expose UBS to the SEC, the IRS, the DOJ (Department of Justice) and the U.S. Senate, but I had to do it carefully, with unprecedented documentation. That would also ensure that the corrupt DOJ could not bury my story.
You talk about how dirty money has been long played a key role in undermining society. What can we do about that — and is there any way to fight back?
Unfortunately, dirty money exists worldwide. What we need are full transparency and accountability in the financial sector. And we need to end the ability of the financial sector to influence politicians in any way. We also need the corrupt DOJ to start enforcing the law against bank executives and employees. Having banks pay money without any prosecutions proves the DOJ is the problem.
You’ve endured a lot: you were about to be framed by your own employer, and then for all your information you wound up thrown in jail. Did you ever lose hope that you’d be vindicated?
I know the financial system is like organized crime — with the clear support of the Department of Justice behind it. The average American simply has no way to compete with this diabolical duo. And I was prepared for that. I also knew that the truth would ultimately prevail. I now have $104 million reasons why I am right, and the DOJ is dead wrong.
Can you give some examples of the offshore banking industry as it still exists today?
The offshore banking world operates in various locations. It does serve a legal purpose, but when individuals, corporations and governments abuse the system, we perpetuate an environment of illegal conduct. The main centers today are Luxembourg, Hong Kong, Singapore, Dubai, Cyprus, and Panama. But there are others locations as well.
How much money do you estimate sits in secret offshore accounts?
Three to four trillion dollars.
Why is whistleblowing so important? Can’t we trust that law enforcement will do their job?
As a matter of public policy, whistleblowing is an essential part of our society. But whistleblowers are treated terribly. They’re misunderstood, threatened, intimidated, terminated, ruined financially, and prosecuted — because the overwhelming powers of politics and business despise being exposed for their willful wrongdoing and criminal conduct. Law enforcement is the problem: they fail to uncover the waste, fraud and corruption in the first place. Once the fraud has been uncovered by a whistleblower, law enforcement then attacks them. The attack is meant to silence them. It sends the worst possible message: that if you see wrongdoing, it’s you who will be punished, not the perpetrators.
Are you involved with any other nation’s efforts to recover their lost revenue from offshore banking now?
I am helping a variety of governments to understand just how UBS cheated them of tax proceeds, and committed other illegal acts that go back decades. I’m also working with those governments to introduce and improve whistleblowing laws for future individuals. I’m doing this free of charge, for any country that asks me.
I have to ask: How was it that you were received an award of $104 million for your information?
The most successful anti-fraud law ever passed in the United States was the whistleblowing law signed by Abraham Lincoln in 1862 — the False Claims Act. That law has recovered billions of dollars for the United States. And under its provisions, whistleblowers are rewarded a percentage (fifteen to thirty percent) of what’s recovered. The law has been adjusted over the years. And the award is a way of recognizing whistleblowers for taking such an enormous risk, because it is a risk indeed.
What’s your advice to someone who sees wrongdoing and wants to blow the whistle?
Contact me directly, so I can advise you on exactly what to do, and what not to do.
For more about the author and his story, Lucifer’s Banker, go to his web site.