By admin 
Peter Schiff broadcasts his radio show in 2013. (Credit: Gage Skidmore/Wiki)
The lawsuit follows years of international investigation into Schiff and Euro Pacific Bank, which he founded in Puerto Rico.
Peter Schiff, a stockbroker, financial commentator and resident of Puerto Rico, has filed a civil rights lawsuit against the U.S. Internal Revenue Service, Puerto Rico’s Financial Institutions Commissioner’s Office (OCIF, in Spanish) and several international tax enforcers, alleging conspiracy to unlawfully seize his property and damage his reputation.
The lawsuit, filed Monday in the U.S. District Court for the District of Puerto Rico, also names tax authorities in Australia, Canada, the Netherlands and the United Kingdom as defendants.
At the heart of Schiff’s claims is a 2022 investigation led by the IRS’s Joint Chiefs of Global Tax Enforcement, or “J5,” a group of tax enforcement agencies from five countries.
Schiff alleges that IRS officials, including former Chief of Criminal Investigation Jim Lee, conspired with OCIF to shut down his bank, Euro Pacific International Bank, through a campaign of false accusations and regulatory maneuvers.
Schiff, who has lived in Puerto Rico since 2017, claims these actions violated his civil rights, denied him due process and amounted to an illegal seizure of his assets.
The lawsuit follows years of international investigation into Schiff and Euro Pacific Bank. In 2020, several media outlets reported that Euro Pacific was being investigated by J5 for alleged money laundering and tax evasion.
According to Schiff’s lawsuit, those reports were based on confidential information leaked by IRS officials, a move he describes as part of a “publicity stunt” to boost the agency’s reputation.
The 55-page complaint seeks to hold the IRS and OCIF accountable for actions that the plaintiff alleges were intended to destroy its banking and business reputation.
In the lawsuit, Schiff alleges that OCIF commissioner Natalia Zequeira-Díaz worked with IRS agents to block the sale of Euro Pacific to a third-party buyer in early 2022. Schiff claims that OCIF initially supported the sale, but later changed course under government pressure. tax authorities. According to the lawsuit, this decision came despite full disclosures about the transaction and the buyer’s financial qualifications.
Schiff offered to inject $7 million of his own capital into the bank if necessary to ensure financial stability, the complaint said.
“His offer to inject $7 million in capital was rejected by the OCIF Commissioner, who assured him that the bank’s current capital level, while lower than the minimum required by law, was sufficient to keep the bank functioning prior to the completion of the sale to Qenta. the lawsuit said.
According to the lawsuit, OCIF blocked a sale of Euro Pacific’s assets to Qenta, a U.S.-based company that had offered $17.5 million for the bank. Instead, the bank’s assets were later sold at a loss to Qenta for $1.25 million – a transaction that, according to Schiff, “returned seven cents on the dollar, rather than trying to get the highest possible value for all parties involved, and therefore failed to comply. its) fiduciary duties.”
The lawsuit accuses OCIF of knowingly allowing “Operation Atlantis,” an IRS-led investigation, to overshadow the bank’s closure while officials knew Schiff was not directly involved in any alleged misconduct.
During a press conference on June 30, 2022, IRS and OCIF officials said announced The closure of Euro Pacific, citing ‘capital shortages’.
“There is no doubt that OCIF’s work sends a strong message to others that the Puerto Rican financial sector will not be a haven for tax evaders or illegal behavior. We stand here together today to demonstrate the strong partnership we have with OCIF and to commend their leadership for taking decisive action,” Lee said at the press conference at the time.
However, Schiff claims this was a “pretext” to discredit him and his bank.
Schiff claims that IRS officials informed multiple journalists about the press conference hours before he or his legal representatives were notified.
“Selling the bank’s assets instead of the entire institution was the most damaging option for everyone involved,” Schiff’s attorney said. “OCIF and the Trustee should have pursued the share sale, which would have maximized value and ensured stability for customers.”
Schiff also claims he was misled into believing he could restructure the deal to avoid owning stock in the new entity, a concern reportedly raised by OCIF. However, Schiff says OCIF never gave him a fair opportunity to address the issue, which became a “pretext” to reject the sale.
Schiff claims that the damage inflicted by the IRS and OCIF extends beyond finances and has serious consequences for his personal and professional reputation.
The lawsuit notes that following the IRS press conference in June 2022, numerous media outlets published stories implying Euro Pacific’s involvement in criminal activity. Schiff claims that IRS officials deliberately fueled these stories and released unsubstantiated allegations to the press to attract international attention.
According to the lawsuit, OCIF’s fines and penalties have exacerbated the bank’s problems. Schiff alleges that OCIF imposed a $700,000 fine after failing to renew Euro Pacific’s license in 2022, an action he said was inconsistent with OCIF’s usual practice.
The complaint also suggests that the IRS may have provided incentives for Puerto Rico to participate in its efforts against Euro Pacific, alleging that the IRS’s removal of Puerto Rico from a list of jurisdictions with a high risk of money laundering was part of a “quid pro quo”. regulation.
In addition to damages in excess of $75,000, Schiff’s lawsuit seeks declaratory relief, claiming that the IRS and OCIF violated his constitutional rights. He is also seeking compensation for the reputational damage he claims he has suffered from what he describes as a campaign to “wrongfully close the bank and discredit it.”
This is the second lawsuit Schiff has filed against the IRS in recent months. In July, the financier filed a lawsuit in the U.S. District Court for the Columbia District over a Freedom of Information Act request. report.
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