Newport Beach-based developer Igor Olenicoff on Tuesday filed a $500 million lawsuit against UBS AG and others, claiming they orchestrated a massive fraud that led to federal tax charges against him.
The lawsuit is tied to a long-running tax dispute that Olenicoff, the billionaire founder of Olen Properties Corp., resolved with the government earlier this year.
A UBS representative said the company hadn’t seen the lawsuit yet and declined immediate comment.
In April, Olenicoff was sentenced to two years of probation after pleading guilty to filing a false tax return and paying $52 million in back taxes and penalties.
The lawsuit, filed on behalf of Olenicoff and Olen Properties, claims that Olenicoff was manipulated by a UBS banker and others into creating fictitious trusts, bogus corporations and other false entities to hide some $200 million of his assets.
The conspiracy is alleged to have occurred between 2000 and 2007.
Thousands of investors were similarly deceived by UBS’ actions, the lawsuit contends.
“This pattern of abuse represents one of the worst instances of corporate fraud ever seen,” said Steve Baric, a partner with Irvine-based Horizon Law Group LLP, which is representing Olenicoff and Olen Properties.
Olenicoff’s lawsuit was filed in the U.S. District Court for the Central District of California’s Southern division in Santa Ana.
Among other parties, the lawsuit names two of Olenicoff’s bankers, UBS’ Bradley Birkenfeld and Mario Staggl, a Lichtenstein-based consultant, as defendants in the lawsuit.
Birkenfeld and Staggl were charged in May by the Department of Justice with conspiring to defraud the U.S.
The Department of Justice’s indictment claims that Birkenfeld and Staggl helped Olenicoff prepare false documents, advised him to destroy all foreign bank records and assisted in preparing false tax returns.
