Israel's largest bank has had to pay a US$220 million penalty to the New York State Department of Financial Services for having knowingly helped HNW Americans to evade state and federal taxes through its conduct of an illegal cross-border banking business, but this is only the beginning of its worries.

In addition to that penalty, the bank has signed agreements to pay more than $654.27 million to the Treasury and the Federal Reserve.

Many affluent New Yorkers went to great lengths to avoid paying their share of tax and Bank Hapoalim offered a whole array of services to them that helped them do it. Principal Deputy Assistant Attorney General Richard Zuckerman says that the bank has admitted to its crimes and will surrender all the fees that it earned, repay the US Government for lost revenue and pay a substantial fine. He is much exercised by the size of the fees the bank collected to provide its illegal service.

To effectuate its help to the tax evaders, which the DoJ describes as a 'scheme,' Bank Hapoalim, independently or through its Swiss subsidiary:  

• opened and maintained 'coded,' 'numbered,' and 'encrypted' accounts, making sure that the name of each account holder did not appear on any correspondence or account statement because the bank used a code or a pseudonym instead;
• opened and maintained accounts in the names of trusts and suggested to US customers that they ought to open trust accounts at entities that were wholly-owned subsidiaries of the bank, its Swiss subsidiary, or other structures;  
• opened accounts for customers known to be citizens or permanent residents of the United States by using unAmerican forms of identification, the better to mask their citizenship from compliance officials and/or regulators;
• opened accounts in the names of offshore entities without indicating that the beneficial owners of the entities were Americans;
• provided many a customer with a 'hold mail' service, which provided for the holding of every statement of account, notice, or other document associated with the account at the branch where the foreign account was maintained instead of those documents being sent to the customer’s address; and
• issued interest-bearing loans through its US branches that were secured with the assets in the overseas accounts, effectively giving the American tax-evaders access to the assets that they held overseas.  

Meanwhile, the bank's involvement in the FIFA football bribery affair has also earned it fines that bring the total up to almost US$1 billion.