Law enforcement raids Caterpillar facilities in Peoria

Federal officials seized documents and electronic records Thursday from three Caterpillar Inc. facilities, including the global headquarters in Peoria, Ill. This raised a red flag with the authorities, according to a report from Bloomberg.

The company has said it will “vigorously contest” the tax bill. Schlicksup settled the suit in 2012.

“We believe the relevant transactions complied with applicable tax laws and did not violate judicial doctrines”, Caterpillar said in the disclosure.

Investigators executing search warrants represented the Federal Deposit Insurance Corporation’s Office of Inspector General, the IRS’ Criminal Investigation Division and the U.S. Department of Commerce’s, Office of Export Enforcement, Paul confirmed.

The subsidiary in Switzerland was the focus of a 2014 investigation by the U.S. senate alleging it was set up to shift billions of profits overseas to avoid paying taxes in the US.

Morningstar analyst Keith Schoonmaker said that Caterpillar’s current exposure could rise to $3 billion, since the company has continued to file tax returns on the same basis.

The facility in Morton is responsible for shipping and receiving after-market parts to facilities and dealers worldwide, Reuters reported citing the company’s website. Among those penalties was a retroactive taxing of profits earned from Caterpillar SARL, a Switzerland-based parts subsidiary. The scheme, which allegedly operated from 2000 to 2009, was known as the “Swiss structure”. In response to the case, Caterpillar denied the allegations, according to the Journal Star.

In 2014, a Senate subcommittee asserted that the company avoided or deferred $2.4 billion in taxes over the course of 13 years. Federal agents also took part in the Thursday raids.

A viewer sent a photo of law enforcement wearing IRS jackets entering headquarters.