In what is believed to be the largest individual whistleblower payout in U.S. history, the IRS has awarded former UBS banker Bradley Birkenfeld $104 million for his role in uncovering the bank’s illegal use of offshore accounts. Information provided by Birkenfeld through the IRS’s whistleblower program led ultimately to a deferred prosecution agreement with UBS netting $780 million in fines.

The award, the first paid under the IRS whistleblower law passed in 2006, comes roughly five years after Birkenfeld first blew the whistle on UBS’s offshore scheme. Patrick Burns of Taxpayers Against Fraud predicted that as the program gains momentum, it may well “dwarf” the False Claims Act’s recoveries (estimated at $8 billion for 2012) and help to close the $400 billion yearly gap between taxes owed and taxes paid.

Birkenfeld’s attorneys, meanwhile, emphasized the immediate incentive and deterrent effects of their client’s award: “The IRS today sent 104 million messages to whistleblowers around the world—that there is now a safe and secure way to report tax fraud and that the IRS is now paying awards. The IRS also sent 104 million messages to banks around the world—stop enabling tax cheats or you will get caught.”

Read the entire article, “Birkenfeld’s $104 Million IRS Bounty”