In his complaint against Caterpillar, Schlicksup alleged the company sold and shipped spare parts globally from its warehouse in Morton while attributing at least $5.6 billion of profits from those sales to a unit in Geneva, Switzerland. This scheme, which operated from 2000 to 2009, was known as the "Swiss structure." Caterpillar SARL is based in Geneva.
A different strategy, the "Bermuda structure," allegedly involved shell companies that had no business operations returning profits to the United States without paying taxes on them.
The company denied the allegations.
The accusations, however, prompted an inquiry by an investigative panel of the U.S. Senate. The probe found Caterpillar saved about $2.4 billion in taxes through the "Swiss structure" over the course of 13 years. The Internal Revenue Service eventually proposed a $1 billion tax increase and penalties for years 2007-2009.
IRS agents were among the officials executing the search warrants on Thursday.
At the Downtown Caterpillar global headquarters building, at least some company employees were directed to the building's cafeteria and were told to remain there and not leave, according to one employee at the facility. Another source with direct knowledge indicated those sequestered there include employees in the Treasury, tax and accounting divisions, as well as from executive offices. At least some of those employees were released to go home for the day at approximately 11 a.m., with some being told that they would learn later in the day Thursday whether they'd be allowed to return to their offices on Friday.
An employee at Building AD in East Peoria said the arrival of agents at that facility was less disruptive than the one in Downtown Peoria appeared to be, with agents executing warrants at the East Peoria site appearing to concentrate on securing emails and electronic records.
Some of the agents entering the headquarters building wore jackets bearing an Internal Revenue Service logo, others appeared to be from the Federal Deposit Insurance Corporation. Others simply denoted that they were federal agents. A placard in the window of one of the federal vehicles noted it was used by police from the U.S. Department of Commerce Bureau of Industry and Security Office of Export Enforcement.
