The founder and former owner of the Michele Watches company, a Miami-based luxury watch brand, pleaded guilty to a major tax evasion fraud. Jack Barouh allegedly had offshore accounts where he hid profits he made to avoid having to pay taxes on them.
In this particular case he was charged with putting away $10 million in an account he made with the UBS Swiss bank. Barough did not report the income he earned from those accounts and he filed a false tax return based on that information.
He is said to have “skimmed the profits” off his previous business ventures, relocating them to those offshore accounts, where he believed them to be out of the watch of the IRS. Included in those business ventures is the sale of the Michele Watches company he sold in 2004 to Fossil Inc. based in Richardson, Texas for about $50 million.
It is estimated that Barouh evaded some $736,000 between the years 2002 and 2007.
Barouh, who is now free on a $1 million bond, could face up to three years in jail. He is the seventh former UBS client to be found guilty of tax evasion.
The bank has admitted in the past that it has helped US taxpayers move their money elsewhere to avoid paying taxes. As part of a deferred prosecution agreement, UBS provided the US government with names and account identities of some of their overseas clients.
Barouh’s sentencing is set for April 16.