Tuesday, May 7, 2013

Article on Prosecuting Tax Professionals to Leverage Deterrence (5/7/13)

Scott A. Schumacher, here, a co-author of Tax Crimes, here, has published on SSRN an article titled Magnifying Deterrence by Prosecuting Professionals.  The article  on SSRN is here.  The abstract from the SSRN page is:

Magnifying Deterrence by Prosecuting Professionals 
Scott A. Schumacher 
University of Washington - School of Law 
March 1, 2013 
89 Ind. L.J. ___ (2014) Forthcoming 
This article examines the recent series of criminal prosecutions against tax professionals and offshore bankers. These criminal cases, brought against the largest Swiss bank (UBS), the oldest Swiss bank (Wegelin), one of the largest accounting firms in the world (KPMG), as well as numerous lawyers and accountants, was a dramatic shift for the U.S. Department of Justice. After decades of tolerating abusive tax shelters and tax haven banks, the Government changed its policy. However, rather than indicting the individuals and corporations who invested in tax shelters or hid money in offshore accounts, the Justice Department indicted the lawyers, accountants, and bankers who advised them. This article will analyze those prosecutions from a theoretical, historical, and practical perspective, and will examine the impact the new prosecution policy will have on the legal professional, the tax system, and international relations. 
This is the first article to examine these issues, and it is a combination of my prior scholarship involving tax shelters and criminal tax matters, including my casebook TAX CRIMES. The article will be of great interest to anyone teaching or practicing in the areas of taxation, criminal law, and criminal theory. It will also appeal to those interested in the role of lawyers and other professionals within the legal system. It therefore should have wide appeal amongst faculty readers, as well as practitioners and policy-makers. 
Number of Pages in PDF File: 53
Keywords: Tax havens, tax shelters, prosecuting professionals, tax crimes, criminal theory
The Table of Contents gives the scope of the article:
I. A Brief History of Tax Prosecutions
A. Tax Shelters
B. Tax Havens
II. A Sea Change
A. The Tax Shelter War
B. The Swiss and Liechtenstein Tax Haven Cases
1. Liechtenstein and LGT
2. The Other Tax Haven Scandal – UBS
III. The New Prosecution Policy and Criminal Theory
A. The Ambiguity of Tax Crimes
B. Inconsistent Enforcement
C. The Problems with All this Vagueness
D. Prosecution Policies
IV. Analysis of The New Prosecution Policy
A. Tax Shelter
1. Relative Culpability
2. Compensating the Victim
3. Deterrence
4. Preserving the Integrity of the Tax System
5. Summary
B. Tax Shelter
1. Relative Culpability
2. General Deterrence
3. Compensating the Victim: Tax Haven Abuse Developing World
4. Preserving the Integrity of the Tax System
5. Summary
V. Conclusion 

1 comment:

  1. I haven't seen this mentioned on the blog, but in late April Swiss press reported that a Swiss banker who since 2009 had worked with Russian clients at UBS, and since 2012, with Russian clients at Coutts in Geneva, was arrested in NY when he arrived to the US and had been sent to Florida. Apparently some of these clients were dual Russian-US citizens.

    Link (in German)



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