U.S. Internal Revenue Service officials are stepping up an international tax evasion investigation into HSBC Holdings and the city of Hong Kong in an effort to crack down on American tax evaders, the South China Morning Post reported.

IRS officials are now stationed in overseas Asian jurisdictions, including at the American consulate in Hong Kong, so they can gather more information on the tax evasion network, according to Travis Benjamin, the head of tax practice at law firm Deacons.

"We're seeing greater activity of foreign tax authorities, not only those of the US, in investigations and information gathering in jurisdictions across Asia, including Hong Kong and Singapore," Benjamin told the Morning Post.

Since the Foreign Account Tax Compliance Act (Fatca) took effect last July, U.S. authorities have ramped up their efforts to track down American tax cheats living abroad in cities like Hong Kong, said Peter Chen, a partner at Chinese firm Zhong Lun.

Under Fatca, worldwide financial firms are required to report information to the IRS regarding clients who are U.S. taxpayers.

Last month, the U.S. Department of Justice (DOJ) announced that HSBC and Hong Kong were suspected to be involved in an international tax evasion ring. The department required HSBC's American division to provide information on U.S. tax evaders who were thought to be using offshore service providers to hide assets overseas.

Banks in Hong Kong and Panama were suspected of working together in the scheme as well.

The DOJ also accused Germany's Deutsche Bank of creating a tax evasion scheme in 1999 to avoid upwards of $100 million in federal taxes, reported The International Business Times. Israel's second largest bank, Leumi, was recently discovered to be helping Americans evade taxes, and agreed to pay $400 million in compensation.