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November 27, 2022

Accounting News Roundup: Is Tax Reform Dead?; KPMG Hit with a Setback in ‘Pippins’ Labor Case; Tax Cuts for the Taxless | 02.08.12

Some Stanford Assets Were Profitable Before U.S. Seizure, Ex-CFO Testifies [Bloomberg]
James M. Davis, Stanford Financial Group Co.’s former finance chief, told jurors that R. Allen Stanford’s businesses collapsed in part because the stock market imploded and a court-appointed receiver destroyed much of the companies’ value after they were seized by the government. Davis, testifying for the government under a plea deal at Stanford’s federal court trial in Houston, was shown a letter he wrote shortly after regulators seized Stanford’s companies in February 2009. “There was from the start never a thought to put the clients in harm’s way in this process, never a hint of criminal intent,” Robert Scardino, a lawyer for Stanford, read from the letter, which Davis said he wrote to an attorney he was trying to hire to defend him at the time. “The underlying global business growth model remained strong,” Davis wrote in the letter, adding that some of Stanford’s businesses were moving toward profitability. “Isn’t that 180 degrees opposite from what you’ve been telling this jury?” Scardino asked Davis. “You said these companies had no value.” Davis responded, “A number of the companies Stanford owned were growing; they were worth something.” The 2009 letter “could be true under certain circumstances,” he said.

Levin, Conrad target tax breaks [The Hill]
Sens. Carl Levin (D-Mich.) and Kent Conrad (D-N.D.) say their bill would raise at least $155 billion in fresh revenues over a decade – enough, they say, to pay for a full year of the payroll tax cut and help eat into the federal debt.  “With federal tax revenue at its lowest level in decades and economists warning that more draconian budget cuts could damage the recovery, it is clear that we can’t achieve significant deficit reduction and meet important priorities by focusing on spending cuts alone,” Levin, who has targeted offshore tax havens as chairman of a Senate investigations subcommittee, said in a statement.  For his part, Conrad, the chairman of the Senate Budget Committee, has sought a grand deficit-reduction deal that would reform the tax code in a way that immediately produced fresh revenues. Still, Democrats have been pushing to scrap certain tax credits and deductions – like preferences used by oil-and-gas companies – for months, and found practically no support from Republicans. 
 
Say Bye-Bye to Reform: Obama Becomes Clinton [Martin Sullivan]
MS: "[T]here is really no commitment from the Obama administration for broad-based tax reform. The administration's lack of interest in comprehensive reform is evident in its non-endorsement of any of the recommendations of the commissions[.]"
 
KPMG Loses E-Discovery Appeal in 'Pippins' Labor Case [LTN]

"Based on Plaintiff's recollections regarding their former hard drives, I agree with [Magistrate Judge James] Cott that the hard drives are likely to contain relevant information," wrote District Court Judge Colleen McMahon, of the Southern District for New York, in a bluntly written ruling Friday afternoon. "It smacks of chutzpah … to argue that the Magistrate failed to balance the costs and benefits of preservation when KPMG refused to cooperate with that analysis by providing the very item that would, if examined, demonstrate whether there was any benefit at all to preservation," McMahon asserted. "KPMG could have established [that producing all the drives was unnecessary] by producing several hard drives to Plaintiffs and Magistrate Judge Cott. … But KPMG has established nothing of the sort," McMahon stated.
 
Judge in RI rejects request from Richard Hatch to pay IRS $25 in January for tax evasion case [AP]
[Hatch] was ordered to pay 25 percent of his gross income to the IRS as part of his sentence for violating terms of his supervised release. He sought the reduced payment, saying he’d earned only $500 since being freed in December.
 
Can you cut taxes for people who don't pay taxes? [Tax Update]
Joe Kristan cliarifies the truthiness.
 
House Holds Hearing Today on The Interaction of Tax and Financial Accounting on Tax Reform [TaxProf]
This raucous hearing will include E&Y's Tom Neubig, Director of Quantitative Economics and Statistics (how's that for a title?).  
 
Boston gets Butterfinger candy in honor of Patriots loss to Giants [NYP]
900 pounds worth.

 

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