Legal issues

Tax

More than a Thousand Whistleblower Cases Discarded in 2004

Washington, DC — The U.S. Special Counsel has dismissed more than 1,000 whistleblower cases in the past year, according to a letter from the Bush-appointed Special Counsel released last week by Public Employees for Environmental Responsibility (PEER). The Special Counsel appears to have taken action in very few, if any, of these cases and has yet to represent a single whistleblower in an employment case.In a letter dated February 14, 2005 and addressed to U.S.
Community News

Defense of WorldCom's Ebbers Begins with Whistleblower

Lawyers for former WorldCom Inc. Chief Executive Bernard Ebbers launched their defense Wednesday afternoon with testimony from the whistleblower credited with alerting WorldCom's board to the massive accounting fraud.Cynthia Cooper, the former head of internal auditing at WorldCom, testified that auditors at Arthur Andersen gave a "green light" rating to the company's accounting for 2000 and 2001, the Associated Press reported.

New Tools, Strategies Used To Prosecute U.S. Corporate Crimes

By Christopher Wray, Assistant Attorney General, Criminal Division, U.S. Department of JusticeCorporate crimes injure investors, employees, and the capital markets that fund the needs of existing firms and promote new businesses.
Tax

Andersen Appeal to go Before Justices in April

According to The Houston Chronicle, the United States Supreme Court announced this week it will hear arguments April 27 on whether to overturn the conviction of the Arthur Andersen accounting firm for obstruction of justice in the shredding of Enron documents. The focus of the appeal will be on how the law was presented to the jury. A decision could come as early as June.Last month the Supreme Court agreed to hear the appeal of the company's June 2002 obstruction of justice conviction.
Community News

Judge Rules E&Y Papers Should Remain Private in Bankruptcy Case

Documents related to Ernst & Young LLP's audit of now-defunct Metropolitan Mortgage & Securities will remain private, a bankruptcy judge in Washington state has ruled.U.S.

New Tools, Strategies Used To Prosecute U.S. Corporate Crimes

By Christopher Wray, Assistant Attorney General, Criminal Division, U.S. Department of JusticeCorporate crimes injure investors, employees, and the capital markets that fund the needs of existing firms and promote new businesses.

Verizon Chief Testifies About Buyout Offer of WorldCom

The chairman and chief executive of Verizon said in court Thursday that he repeatedly approached former WorldCom Chief Executive Bernard Ebbers in 2001 about buying the company.Advertisement
Community News

Ernst & Young Sued For Its Computer Associates Audit

Dallas investor Sam Wyly has filed a lawsuit against Ernst & Young LLP, claiming that the firm's audit influenced him to sell his software company in exchange for stock in Computer Associates International Inc.Ernst & Young was the auditor for both companies when Sterling Software Inc., which Wyly headed, was sold to Computer Associates for $4 billion in March 2000, the Wall Street Journal reported.
Technology

New Technology Gives E-Mailers Chance to Rethink Messages

Who hasn't hit send on an e-mail message and instantly wanted to get it back? Whether it contains inappropriate content or private company information, a new product aims to give users a second chance.Forbes reported that a new product from a company called InBoxer (formerly known as Audiotrieve) is on display at the Demo Conference in New York this week. The product, known as OutBoxer, scans outgoing e-mail messages looking for inappropriate content, unauthorized disclosure of information and tries to encourage senders to improve their messages before they actually send them.

OfficeMax CEO Resigns, Six Others Fired in Accounting Scandal

The nation's No.3 office supply store chain has announced the resignation of its chief financial officer and termination of six other employees after an internal investigation yielded accounting irregularities, the Associated Press reported.OfficeMax Inc. announced the resignation of CEO Christopher C. Milliken and said George J. Harad, the company's executive chairman, would replace him on an interim basis. The Itasca, IL, company said it would begin a search for a permanent CEO, a task that could be hampered by a simultaneous chief executive search by No.
Community News

New Report Highlights KPMG's Tax Shelters

KPMG says it “regrets its participation” in four tax shelters studied by a Senate subcommittee, which on Thursday released new details about how the accounting firm developed and sold the products being investigated.The Permanent Subcommittee on Investigations, in its second report on questionable tax shelters, noted that a KPMG senior executive said in a 2003 hearing that the firm did not have the technical capability to track sales and revenues from the tax shelter sales, the New York Times reported.
Tax

Federal Court Halts Tax Fraud Scam in Missouri

The Justice Department announced this weel that a federal court has barred Janis E. Greehey, of Branson, Missouri, from selling the “corporation sole” and “claim of right” tax schemes. The order, entered by Judge Richard E. Dorr of the U.S.
Tax

Miami Businessman Sues Bank of America in Online Banking Incident

Joe Lopez, a Miami businessman who regularly conducts business over the Internet, is suing Bank of America for negligence and failure to provide protection for online banking risks of which he claims the bank was aware. Last April, Mr. Lopez's computer system was hacked into and $90,348.65 was wired from his account at Bank of America to a bank in Riga, Latvia without his approval. Ralph Patino, Mr.
Tax

HealthSouth's Former President Indicted, Faces Financial Ruin, Jail Time

The former president and chief operating officer of HealthSouth Corp., James P. Bennett, was indicted on Thursday for his alleged part in a $2.7 billion accounting fraud that occurred from 1996 to 2002. HealthSouth was the country's largest operator of rehabilitation hospitals.Prosecutors have accused Mr.
Tax

WorldCom Settlement Rejected, Case Headed for Trial

In a surprise decision, U.S. District Judge Denise Cote of the Southern District of New York ruled on Wednesday that a provision in the settlement agreement in the class-action case against WorldCom was illegal.
Tax

U.S. Attorney Charges Five with $30M 'Under-the-Table' Payroll Fraud

The Law News Network -- Five individuals have been charged in federal court with participating in a massive tax and insurance fraud scheme in connection with their operation of temporary employment agencies in Southeastern Massachusetts. They are accused of paying employees over $30 million in cash "under-the-table" in order to evade millions of dollars in payroll taxes and workers compensation premiums for their businesses. United States Attorney Michael J. Sullivan; Joseph A. Galasso, Special Agent in Charge of the U.S. Internal Revenue Service, Criminal Investigation; Kenneth W.
Community News

Tax Dodger Convicted on 13 Federal Counts

Can you be convicted of conspiracy if you openly declare the government's tax laws to be illegal and refuse to pay? Apparently so.Al Thompson, 58, one of the nation's most notorious tax avoiders was convicted Friday on all but one of 14 tax charges he'd faced after failing to withhold taxes from his workers' pay more than fours ago.Thompson, who acted as his own attorney in the case, was the owner of a now-defunct small manufacturing company in California, the New York Times reported.
A&A

Marsh & McLennan Agrees to Apologize, Pay $850 Million

Marsh & McLennan Cos. has agreed to pay $850 million to settle civil fraud charges brought by New York state's attorney general and the state insurance department, the Wall Street Journal reported.The agreement also involves an apology to the clients of the New York City-based financial services company, which allegedly rigged bids for insurance contracts and directed business to insurance companies that paid lucrative “contingent commissions" to the Marsh Inc. insurance brokerage.
Tax

Failed Venture Prompts Wealthy Investors to Sue KPMG

A Houston investment fund, which started as a promising money-maker for a group of wealthy, well-connected acquaintances, has ended in a Texas district court with accounting firm KPMG on the hot seat.Investors include the Staley family, founders of the Chicago Bears, the man who brought Nintendo to America, the Cullen family and a former Harris County (Texas) District Attorney, who have all made wise investments in the past.
Community News

Former E&Y Audit Partner Jailed for SOX Violations

Back in October of 2004, Thomas Trauger pled guilty to falsifying records in a federal investigation in violation of the Sarbanes-Oxley Act. He admitted as part of this plea that he knowingly altered, destroyed and falsified records with the intent to impede and obstruct an investigation by the Securities and Exchange Commission (SEC). This is one of the first cases of document destruction brought under the recently enacted Sarbanes-Oxley Act. U.S. Attorney Kevin V.

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