Northern, WI 1/30/2013 (tradewatchmedia) – A Manhattan federal court authorized the IRS to serve summons on UBS for records of Wegelin & Co.’s correspondent account, yesterday. The records which the IRS demands could reveal the identity of people who held assets at the Swiss bank using UBS accounts. The Wegelin & Co.,  admitted to assisted in US tax evasion of over $1.2 billion worth of assets, On January, 3rd.

Pauley gave permission to the IRS to serve as so-called John Doe summons on UBS. The court petition charged Wegelin for maintaining a correspondent account through the UBS’ Connecticut office.

Through a “correspondent account” with UBS, the accused bank was offering “offshore banking services ——–to dozens of U.S. taxpayers” Kuehler wrote in his filing submitted in January, 25th. According to the filing, many of these American clients might have “failed to report the existence of their Swiss bank accounts to the Treasury”.

Last year , the prosecutor had commented that over one hundred taxpayers in America were involved in the conspiracy plotted by the Swiss bankers including Roger Keller, Urs Frei and Michael Berlinka. The accused who are based outside of America were pointed out in January last year. None of them appeared before the court. According to the prosecutors’ indictment over $1.2 billion worth of assets held were undeclared to the agency.

The state contends that Wegelin & Co., and the three bankers persuaded clients based in the U.S. who were abandoning UBS which had pleaded guilty to tax evasion charges in 2009. The bank settled with the state prosecutor for over $780 million and immediate disclosure of data relating to about 250 accounts. Information about another 4,450 accounts was disclosed later on.

Wegelin & Co., offered undeclared accounts to at least 70 of those taxpayers, the indictment asserts. In the internal coding the accounts were marked as “BNQ”, to distinguish.

The UBS probe that initiated in 2008 is one of the very few cases where the IRS has used the most dangerous part of its arsenal “John Doe summonses” . HSBC Holdings Plc., was also served with such summons.

UBS had confessed having partners to cheat the Internal revenue services department. The judge held in favor of the Internal Revenue Service IRS , saying the agency is entitled to extend its probe to UBS AG (VTX:UBSN) and inquire about American clientele Wegelin & Co., the Swiss bank that pleaded guilty this month to conspiring to help cheat the IRS.

The Zurich based bank announced that the summons does not relate to any  of its own clients or data from Switzerland. The statement also affirmed the bank’s willingness to cooperate with the probe.

The court’s order could help the state and the IRS to prosecute taxpayers who evade taxes by “secreting their money away in anonymous offshore accounts at Wegelin and other banks,” Bharara , The US attorney said after the ruling was announced.

The Swiss bank UBS AG (VTX:UBSN) trades at the New York Stock exchange under UBS AG (USA) (NYSE:UBS). The Depository receipts of the HSBC Holdings Plc., (LON:HSBA) trade at the New York Stock exchange as HSBC Holdings Plc., (ADR) (NYSE:HBC).

At the market close yesterday, the UBS AG (USA) (NYSE:UBS) traded on the NYSE at $17.55. This is up 0.23% from the last day’s closing price. The HSBC Holdings Plc., (ADR) (NYSE:HBC) traded at $56.85, in the day close yesterday. This is up 1.12% from the  last day’s price.