Saturday, December 23, 2006

"People Go to Jail for That One"

A third defendant involved in the sale of tax shelters by KPMG entered a guilty plea and will cooperate in the government's prosecution of eighteen other defendants.  Chandler Moisen, a businessman, worked primarily with one KPMG accountant located in Denver at the time to promote and structure the tax shelters.  He entered a guilty plea to conspiracy to commit tax fraud and wire fraud.  The plea agreement does not identify the KPMG accountant Moisen worked with, but a New York Times article (here) asserts that it was Robert Pfaff, one of the eighteen defendants awaiting trial in New York.

The criminal information filed in the case quotes from an e-mail Moisen sent to Domenick DeGiorgio, who worked at international bank HVB Group that was involved in the tax shelter transactions, entitled "Us getting rich" (good English, too): “Dom, one of my recurring nightmares involves you/me and our receipt of $. The first used to be that somehow the bank would catch you and we would all go to jail because we were violating federal banking laws . . . That concern of course was started by Bob and has largely dissipated. The second nightmare is that the I.R.S. catches on and you/we are nailed for income tax evasion. People go to jail for that one.”  The article makes the assumption that "Bob" is former KPMG accountant Pfaff. 

Regardless of  Bob's identity, this is yet another illustration of people putting the darnedest things in e-mails, plus giving them some glaringly stupid titles, on the apparent belief that hitting the "Send" button means they no longer exist.  Moisen's e-mail does contain one potentially prescient observation: people do indeed go to jail for tax fraud -- just ask former Survivor winner Richard Hatch.  With the KPMG trial still months away, the pressure on other defendants to cooperate may not be all that great yet, but as it gets closer to the September starting date more may switch sides. (ph)

http://lawprofessors.typepad.com/whitecollarcrime_blog/2006/12/people_go_to_ja.html

Prosecutions, Tax | Permalink

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