Sent home Alabama: Jersey repatriates $1m of criminal money to US

Thursday 03 June 2021

Jersey has sent $1m to America after a convicted tax evader from Alabama used a St. Helier-based gold trader to hide money owed to US authorities.

Attorney General Mark Temple sent the money to the US Treasury in response to a formal repatriation request, made after an Alabama auto-industry salesman was sent to prison for not paying any tax for more than 20 years.

Ivan Scott Butler, of Hoover, Alabama, was an automobile industry consultant who also sold automobile warranties.  

Rather than getting paid directly he used two Nevada-registered nominee corporations to conceal receipt of his income. He did not file tax returns or pay any taxes and in about 1999 he began to move money into multiple Swiss insurance annuities through a Swiss asset manager.  

From 2008, he started purchasing precious metals as another method of concealing assets. 

In around 2013, Butler began to be pressured by his Swiss custodians to disclose his accounts in accordance with US reporting and disclosure requirements.  

He then took steps to convert his Swiss assets to precious metals.   

Pictured: Attorney General Mark Temple.

The US Attorney’s Office for the Northern District of Alabama and the US Department of Justice Tax Division secured a conviction against Butler for the evasion of more than $1m.  

On 27 October 2020, Butler was sentenced to 24 months’ imprisonment in Alabama. He was ordered to pay restitution of US$1,093,400 in taxes and US$290,366.07 in interest. 

He further owed US$1.2m in tax penalties which he agreed to pay in accordance with a civil tax settlement. 

To evade his tax obligations, Butler placed precious metals with Goldmoney Wealth Limited in Jersey. 

He admitted to prosecutors that he used Goldmoney to conceal assets for which he did not file or pay any US taxes, so US authorities sent a formal request to the Attorney General asking for his help with a voluntary repatriation.

With the backing of the police’s Joint Financial Crime Unit, the precious metals were sold and the amount raised - US$983,107.54 - was repatriated to the US Treasury last month. 

Mr Temple said: “The exemplary work carried out by the Mutual Legal Assistance Team of the Law Officers’ Department and the Jersey Financial Crimes Unit demonstrates that the Jersey authorities are eager to work with overseas agencies and that the Island is no place to hide from the tax authorities of any jurisdiction.”

US media have reported that Butler was a recognised ‘tax defier’ – someone who refuses to pay taxes because they believe that the government lacks any legal authority to impose them.