Federal Tax Crimes

    The majority of inquiries by the Internal Revenue Service (IRS) or California Franchise Tax Board (FTB) are civil. However, in the small percentage of cases where there are fraudulent or criminal implications, the process requires extreme caution and special attention. Some cases are known as “eggshell” audits that are civil audits involving sensitive issues (for example, unreported income), which have the potential to turn the case into a criminal investigation if they are discovered by the auditor. The goal of Criminal Investigation (CI) of the IRS and the Federal Bureau of Investigation (FBI) in a criminal investigation is to build a case where the subject will be prosecuted and then sentenced to a fine, restitution, and a term of imprisonment.

    The vast majority of Americans recognize their legal responsibility to properly report and pay their tax obligations. The efforts of CI are directed at the minority of American taxpayers who willfully and intentionally violate their known legal duty to file income tax returns and/or pay the correct amount of income, employment, or excise taxes.

    A criminal investigation (whether it is an administrative investigation or a grand jury investigation) requires expert representation. We are very experienced in representing individuals and businesses (as witnesses and/or targets) in criminal tax and other white collar criminal matters.

    Cases have included:

    • Successfully represented a music promoter and his business in an "eggshell" audit by the IRS.

    • Handled an IRS criminal investigation targeting a multi-office tax preparation business (Liberty Tax Service), and successfully obtained the return of seized assets. The IRS has dropped the investigation.

    • Represented individuals involved in an alleged abusive trust scheme, successfully preventing the case from going criminal, and achieving a favorable civil settlement.

    • Defended a tax preparer accused of preparing false returns and committing bank fraud.

    • Represented a computer software distributor in a currency structuring and forfeiture case.

    • Represented a real estate developer in a voluntary compliance case.

    • Represented taxpayers in sentencing and post-sentencing hearings involving the IRS and FTB in federal and state court.

    • Represented taxpayers in administrative summonses.

    • Represented witnesses in grand jury subpoenas.

    • Represented a highly placed in-house counsel to a major multi-national company in an IRS criminal investigation, involving a whistleblower inside the company.

    • Represented and defended a small distribution company owner in a tax evasion and filing false returns case.

    • Represented a non-resident U.S. citizen in a failure to file investigation.

    • Represented an individual in an auto insurance fraud prosecution by the Department of Justice.

    • Represented a doctor in a tax evasion scheme.

    • Represented a restaurant accused of skimming.

    • Represented a contractor in a tax evasion prosecution in District Court.

    • Represented a gambler in a tax evasion prosecution in District Court.

    • Represented an importer/exporter in an “eggshell” audit, which was resolved civilly.

    • Represented a limousine company in a criminal investigation, resulting in a decision not to prosecute.

    • Represented a taxicab company that proceeded to District Court where the case was won after indictment on a Motion to Dismiss based on constitutional violations by the IRS.

    References available on request.