U.S. judge rejects leniency for UBS informant

MIAMWe (Reuters) –A U.S. judge on Monday rejected a request to consider reducing the prison sentence of a key informant in the tax fraud case against Swiss bank UBS AG, and he ordered former UBS banker Bradley Birkenfeld to start serving his 40-month sentence as scheduled this Friday.In a court motion last week, Birkenfeld's lawyers had asked Judge William Zloch of the Federal District Court in Fort Lauderdale to postpone the start of his prison term, saying he was ready to further cooperate with the authorities in their pursuit of U.S. tax cheats.The lawyers had also called for a hearing for Zloch to consider the possibility of a reduced jail term for Birkenfeld, a 44-year-old U.S. citizen who has been hailed by whistleblower advocates and U.S. prosecutors alike as pivotal to the case against UBS, his former employer.The Swiss bank was targeted in a wide probe by U.S. authorities for helping U.S. tax cheats to hide assets in UBS accounts.Zloch on Monday flatly rejected both motions filed on Birkenfeld's behalf, saying they were denied after careful consideration of their merits.Birkenfeld was handed his sentence by Zloch in August, two days after U.S. and Swiss authorities signed a pact in which Switzerland agreed to reveal the names of about 4,450 wealthy American clients of UBS to U.S. tax investigators.Birkenfeld had pleaded guilty to a single fraud conspiracy count in June 2008, when he acknowledged helping his largest U.S. client hide assets from the Internal Revenue Service.In a claim disputed by Birkenfeld's lawyers in a December 7 letter to U.S. Attorney General Eric Holder, Justice Department officials said the jail time was justified because he was not initially forthcoming about the tax fraud committed by his billionaire U.S. client Igor Olenicoff.(Reporting by Tom Brown; Editing by Pascal Fletcher)