When accounting goes unaccounted for
Where’s a Liberian warlord when you actually need one?
NC owes the Treasury around $60k which is really NBD seeing how that’s probably what she spends on antique torture tools to use on her assistants. In a weekend.
Plus, her boyfriend is the so-called “Donald Trump of Moscow,” which could mean a lot of things but it for sure means that dude is rich.
IRS slaps tax lien on model Naomi Campbell [Tax Watchdog]
Because there doesn’t appear to be anything else going on today, we’ll be forced to tell you that Khloe Kardashian should now be at the top of your shit list for reasons none other than she is blaming her accountant for not paying her taxes.
TMZ reported yesterday that K-squared III owed California around $18.5k for ’07. Now the word is that she did pay but the accountant failed to remit the amount owed. Everything is cool though because, by the grace of God, Khloe has found a new accountant and everything should be cleared up shortly.
The only question that remains is, if she paid this twice, what the hell happened to the original $18k? Did the accountant just blow out of town with some Kardash cash? Did it somehow wind up in Reggie Bush’s pockets? Is there a spectacular Ponzi Scheme behind the whole thing that will result in the Kardashians being wiped out of popular culture altogether? God, we can only hope.
Presumably, because the IRS wouldn’t possibly think to question liens taken out against government employees:
Thanh Viet Jeremy Cao, 28, of Rancho Santa Margarita and Las Vegas, is accused of taking out 22 false liens ranging from $25 million to $300 million against employees of the Securities and Exchange Commission, the U.S. Attorney’s Office, the Secret Service and the Internal Revenue Service, as well as false liens against four federal judges, the Department of Justice announced Wednesday.
Young Mr Cao wasn’t just doing this out of spite. Oh my lord, no. He had a theory behind his request for $20 billion in refunds:
Cao, whose business was Phoenix Financial Management Group in Lake Forest, filed fraudulent forms with the IRS on behalf of six clients “that grossly overstate his customers income and withholding to get grossly inflated tax refund checks,” according to a complaint filed Tuesday in U.S. District Court in Los Angeles.
Cao used a theory called “redemption” or “commercial redemption” – which prosecutors called a “rejected tax defier theory.” This theory claims that the U.S. Treasury keeps millions in a secret treasury account for each taxpayer. The secret account can be used to pay a taxpayer’s debts and tax liabilities if a taxpayer sends the IRS and banks certain documents, the theory goes.
“Cao’s theory is complete fiction,” the complaint reads.
Jesus, man. Not even an original crackpot theory. Spend some of those 223 possible years working on developing something new.
Man accused of $20 billion tax fraud [OC Register]
California Man Indicted in Las Vegas for Filing False Liens Against Federal Employees & Filing False Tax Forms [DOJ]
Earlier:
Give It Up Tax Protesters, You’re Just Screwing Yourselves
Robert Snell over at Tax Watchdog tell us about Lil Wayne’s latest problem. This time it’s a $1.1 million tax lien courtesy of the IRS via Dade County Florida.
It’s probably NBD for LW, as he’s dealt with the Service in the past, paying a $977k lien back in August of ’08.
What is interesting is that this particular legal snag is on top of several other accomplishments that Wayne-o has stacked up while in prison.
Last month, he pleaded guilty to a laundry list of drug charges – possession of a narcotic drug for sale, misconduct involving weapons, possession of drug paraphernalia, possession of dangerous drugs – related to a stop that occurred outside Yuma, AZ in 2008.
He [pleaded guilty] over a live video feed from Rikers, and will most likely get 36 months of probation in return (the official sentencing is scheduled for June 30). For those keeping track at home, the plea bargain follows sports blogging, life-saving, prison-rule flouting, and rapping as things Wayne has accomplished while in jail.
And now delinquent taxes. Very impressive.
Lil Wayne, big debt [Tax Watchdog]
Famously Hardworking Rapper Pleads Guilty to Drug Charges While Already in Prison [Vulture]
Who knew!?
Oregon attorney Micaela Renee Dutson and her husband Tony Dutson were convicted of defrauding the U.S. Government of over $7 million but not before doing their damnedest to stave off the IRS and DOJ investigating them.
The Dutsons were a creative couple, selling “pure trust” packages to their clients who were told that their income would be tax free if it were placed in trust. They sold these products despite “several warning letters from the IRS, articles in the Oregonian newspaper warning the public against tax shelter scams, and a compl stice Department on behalf of the IRS in an effort to stop them from selling their tax shelters.”
The IRS started auditing the Dutsons’ clients who, prior to engaging the dynamic tax duo, were seemingly compliant taxpayers. The IRS informed these clients that the “trusts” were actually illegal tax shelters and that they were being bamboozled.
This was, of course, unacceptable to the Mr and Mrs and they went on a serious offensive:
[T]he Dutsons began a campaign to obstruct the IRS’s audits and investigation, and to harass and intimidate the individual IRS employees who were auditing or investigating them. First, they created and presented dozens of fictitious financial instruments to the IRS purporting to pay off back taxes for themselves and a number of their clients.
Even though they knew the bogus instruments had no financial value and had never been accepted by a creditor, they continued to sell them to their clients with false promises they would pay off their tax liability. The Dutsons also advised clients to use them to pay off commercial debts, including mortgages and court-ordered obligations. Together, the Dutsons and their clients presented over $44 million worth of these bogus financial instruments over a four-and-a-half-year period.
To further obstruct the IRS, and harass and intimidate its employees, the Dutsons advised clients to file frivolous lawsuits against the IRS employees. The Dutsons charged their clients $3,500 each to prepare court documents and help their clients file them. They continued to advise clients to file these lawsuits — even after a federal court had dismissed the first of these suits as frivolous and without merit — without telling their clients about the dismissal.
After the Justice Department filed the complaint for a permanent injunction, and IRS special agents had notified the Dutsons in person that they were under criminal investigation, the Dutsons filed a $1 trillion lien in California against several IRS employees who had attempted to audit or investigate the Dutsons, as well as the DOJ attorneys who filed the complaint. A federal court later ruled that the lien was null, void and without legal basis, but one week later, the Dutsons prepared a $108 million lien for a client against John Snow, who was then Secretary of the Treasury.
The Dutson probably figured the jig was up and since $1 trillion is a nice round number the figured “why the hell not?!?” Back in the early ’00s a trillion was fantastical number (for the most part), not tossed willy-nilly like it is these days. The Dutsons could have filed the lien for $1 gabizillion and it would have made as much sense.
Oh and while they were at it, just file another one against the Secretary of the Treasury. If it was Tim Geithner, sure we can see that happening for a whole host of reasons but John Snow? Wasn’t he one of the most harmless cabinet members of the Bush Administration? If they would have filed the lien against Dick Cheney they could have garnered a little popular support at least.
Oregon Attorney Convicted of Tax Fraud After Filing $1 Trillion Lien Against IRS [Web CPA via TaxProf]
UK watchdog launches Lehman audit probe [Reuters]
The UK’s Accountancy and Actuarial Discipline Board (AADB), investigative and disciplinary body for accountants, has started an investigation into the Ernst & Young’s final audit of Lehman Brothers’ UK operations for the year ending November 30, 2007.
E&Y, completely familiar with this drill, is sticking to their guns, “Ernst & Young’s audit opinion stated that Lehman’s financial statements for that year were fairly presented in accordance with the relevant accounting standards, and we remain of that view.”
SEC ‘Revolving Door’ Under Review [WSJ]
Currently, the SEC does not have a cooling off period for former staffers that take a position with a private firm. Former staffers (i.e. lower-level employees) need only to provide a written letter disclosing the fact that they will be representing their new employer in an investigation.
The Journal reports that Senator Charles Grassley (R-IA) announced on Tuesday that an investigation into the practice had recently been launched by the Inspector General David Kotz, “[W]e are currently conducting an investigation of allegations very recently brought to our attention that a prominent law firm’s significant ties with the SEC, specifically, the prevalence of SEC attorneys leaving the agency to join this particular law firm, led to the SEC’s failure to take appropriate actions in a matter involving the law firm,” Mr Kotz said.
The Journal reports that law firm in question “could not be determined.”
There have been several instances of quick transitions of former Commission staffers to new representing their new firms, including the most recent example of an attorney leaving the Division of Trading and Markets for the Chicago-based high frequency trading firm Getco, LLC and an accountant from the enforcement division who represented his new employer in a nonpublic investigation.
IRS hatches new assault on ‘Survivor’ [Tax Watchdog]
Thanks reality TV gods, Richard Hatch is still in our lives. He still owes $1.7 million in taxes from 2000 and 2001.
The CAE’s real challenge – ethics, courage, and complacency [IIA/Marks on Governance]
Norman Marks responds to a commenter that believes that a Chief Audit Executive need not focus on auditing and communicating those results and risks but instead “be conscious of and responsive to management expectations,” and basically substantiate that internal audit isn’t a giant waste of money.
Mr Marks questions this notion in its entirety, “It’s fine to supplement essential assurance activities with the tangible value-adding programs…But, the assurance work has to be covered or (in my opinion) internal audit is failing to do its job. When that is a conscious decision, I have to question the ethics – and the courage – of the individuals involved.”
Swiss Upper House Rejects Call for Referendum on UBS Pact [WSJ]
The upper house in Swiss Parliament would like their counterparts in the lower house to leave their popular referendum idea wherever they found it. Presumably everyone understands that super secret Swiss banking as the world knows it is over and lower house is a little slow to catch on. They’re supposedly debating the referendum circa now.
Class Action Complaint against Amedisys uses Sarbanes-Oxley Act Corporate Governance Provisions to Battle Alleged Corporate Malfeasance [White Collar Fraud]
Amedisys got caught red-handed by the Wall St. Journal abusing the Medicare system and Sam Antar hopes that this is a sign of things to come:
The SEC rules under Sarbanes-Oxley for public company codes of ethics broadly define corporate malfeasance by senior financial officers, requires such companies to promptly report any misconduct, prohibits companies from ignoring any misconduct, and makes it relatively easy for investors to sue for misconduct.
…
Hopefully, more lawsuits will cite code of ethics violations by public company senior financial officers in the future.
When who played one of the most treasured accountants in television history can’t manage to use his fictional expertise to get themselves out of a tax jam, you have to start asking yourself – what chance do any other future thespians that play accountants have?
Robert Snell over at Tax Watchdog reports that George Wendt owes the state of California $30,000 in taxes, citing public records.
Robert did his usual diligence asking for the celebrity’s point of view and he managed to get Norm’s agent, Arthur Toretzky who was less than thrilled with the inquiry. Here’s a portion of his response to Robert’s email:
Do you reporters get a charge out of writing this stuff? George is one of the nicest guys in the world and you want to embarrass him. I just don’t get it. How this wold [sic] has changed. Good luck with getting whatever information you need, and I hope this at least puts you in contention for a Pulitzer.
Not sure if Robert responded to Artie but on Tax Watchdog it’s pretty clear why this is important:
Every year, about $345 billion in federal taxes are either late or unpaid, according to the IRS, ripping open holes in budgets and shortchanging schools and public safety. That forces taxpayers to cough up more than their fair share, tax experts say.
Unless you don’t think that’s a big deal. Besides, if he had Ted Danson’s business manager maybe this wouldn’t have happened.
Yesterday we may shared with you the unfortunate news about the dude from Reading Rainbow having a little tax problem which may have taken you back to the days of still whining about the lack of Cocoa Puffs in your house.
This time around celebrity tax problems take a little bit of a different path down memory lane (and a different theme song to get stuck in your head) to those days where your hormones were in control and the feeling of awkwardness was constant. For those of you too young to be familiar or give a rat’s ass about 90210, we’ll kindly enlighten you by stating unequivocally that Gossip Girl WOULD NOT EXIST without 90210.
Yes, Brenda Walsh, er, Shannen Doherty seems to have run across some tax trouble (just about $250k, NBD really) and as is our wont, we’ll present some possible solutions.
A) Another run at DWTS (nobody really gets it the first time).
B) 90210 movie – May we suggest that old wardrobe and hair styles be incorporated and that they should definitely go for the R rating? (seriously, how many times do you wish Dylan would have said “Fuck you Brandon, you momma’s boy” right in his smug face?)
C) Call ex-boyfriend Rick Salomon and see if he’s interested in making another movie.
D) Serious suggestions welcome.
‘Dancing’ star trips over tax bills [Tax Watchdog]
A refresher:
If that doesn’t mean anything to you, he’s also the dude with the bizarro shades from Star Trek, The Next Generation.
But back to the RR for a sec – many of you would be an illiterate waste of space if it wasn’t for LeVar Burton, so the least you could do is pitch in so the man can pay the $34,000 he owes California. Or at least ask your parents to help out. It’s the least they can do since LB probably bought them some much-needed private time back in the day while you were zoning out on the shower in the toilet.
Tax resistance futile for Star Trek actor [Tax Watchdog]
See also (if you want the RR theme song stuck in your head):
LeVar Burton Owes $34,000 in State Taxes… “But Don’t Take My Word For It” [Tax Docket]
If you feel like nothing in life is ever certain, know this – John Daly will always be a weight fluctuating, chain-smoking, boozehound. And every once in awhile, he’ll have some serious money trouble or just go completely broke.
This is usually followed up with a major win which is then followed up by a total blow-up at the next tournament that may or may not involve Big John ending up passed out pantless on the 18th green in the middle of the night.
The guy has managed to make $9 million throughout his career yet still owes the IRS over a $1 million in back taxes for ’07 and ’08, according to a lien filed with filed by the Service with Shelby County.
His house in Memphis is apparently for sale, for just a smidge under $700k. So if you’re in the market, help the guy out.
Judging by the pics, you’ll have to schlep in your own kegerator and you’ll likely have to replace the carpet due to the ubiquitous cigarette burns but it still looks like a pretty nice pad.
IRS grips, rips golfer John Daly [Tax Watchdog]
Go figure, Christina Ricci has been hit with an IRS lien to the tune of $179,568.30 for unpaid 2008 taxes. Though the lien news seems to have taken her quite by surprise, Ricci’s rep told TMZ that she is taking “immediate action to address it in a responsible manner.”
That’s funny, I thought a responsible manner would have meant paying the IRS $179,568.30 before April 15th, 2009 when it was due but maybe that’s just me.
Oddly enough, if you’ve ever been hit with an IRS lien (hello, Nic Cage) you know that the Service doesn’t just one day decide to slap a lien on you without first attempting to give you a hint that the proverbial shit is preparing to hit the fan. Generally this comes in the form of correspondence (lots of it) indicating that there is an issue.
Helpful bunch that they are, the IRS will almost always work with tax delinquents as long as said delinquents return their letters and get in touch to say “Hey, sorry, totally forgot to give you that $180,000 that I owe you.” In the case of Christina Ricci, we’re pretty sure her IRS letters must have gotten lost in the fan mail and creepy stalker packages. Yeah, that must it.
When celebrities have tax trouble, the majority of reporting out there feels like schadenfreude. Being of the more helpful mindset (especially when it comes to America’s beloved rich [or not so much] and famous) we try to provide solutions for those celebs down on their luck.
In celeb-tax-trouble du jour, Pam Anderson has been named to the California’s Franchise Tax Board Top 250 Tax Delinquents. She owes the people of California nearly $500k.
Someone equally as famous but without the financial difficulties is former VP candidate Sarah Palin.
We’re not suggesting that SP spread the wealth around but just to help out a real American like herself. What’s $500k between two women that share the uncanny ability to seduce the American psyche? They’re a natural team – both have rabid fans; Pam is currently on a reality show, Sarah’s is in the works. Sarah Palin hates taxes; if Pam didn’t before, she certainly does now.
Sure, SP kills animals while Pam stumps for them but those a small issue like digesting animal flesh or wearing fur can surely be set aside for the good of the country. Plus, it would make for a great Sarah stump speech come 2012.
Pamela Anderson Owes $493,000 in Back Taxes [AP]
See also:
California’s Top 250 Tax Deadbeats [TaxProf]
What Do Pamela Anderson And Tim Geithner Have In Common? [DB]
