Today, four current and former partners at Big-4 accounting firm Ernst & Young were indicted on charges including tax evasion, conspiracy to defraud the IRS, and making false statements to the IRS. The partners allegedly concocted and marketed tax shelter schemes "based on 'false and fraudulent scenarios'" to help clients dodge taxes: clients whose taxable income generally was $10-$20 million (International Herald Tribune).
If convicted, the four defendants--Robert Coplan, Martin Nissenbaum, Richard Shapiro, and Brian Vaughn--could face more than 10 years in prison (Washington Post). Though the firm apparently profited from the tax-shelter schemes, federal prosecutors have decided not to bring criminal charges against the firm, itself.
Public accounting firms get so hot and heavily into tax shelters, that I'm surprised that a lot more of them are not up for tax evasion.
Luckily, from their standpoint, the tax code is so incomprehensible to any normal, thinking human being off the street that they have a lot of leeway to comit much "legal" crime, in addition to the occasional illegal hanky panky they get nailed for.
--Jack Payne
Posted by: Jack Payne | July 31, 2007 at 10:09 PM
Jack,
Good Points! I have looked at the Internal Revenue Code, and you're right: it's a nightmare (though it's more clearly written than the old bankruptcy code, if you can imagine such a thing).
Posted by: The Crux | August 01, 2007 at 08:14 PM
Jack,
Good Points! I have looked at the Internal Revenue Code, and you're right: it's a nightmare (though it's more clearly written than the old bankruptcy code, if you can imagine such a thing).
Posted by: The Crux | August 01, 2007 at 08:14 PM