Sunday, December 6, 2020

Bedrosian on Remand -- Held Bedrosian Acted Recklessly and thus Subject to FBAR Civil Willful Penalty (12/6/20)

In Bedrosian v. United States, 2020 U.S. Dist. LEXIS 228208 (D. Pa. 2020), CL here, the district court on remand from the Third Circuit in Bedrosian v. United States, Dep't of Treasury, IRS, 912 F.3d 144 (3d Cir. 2018), held that Bedrosian acted recklessly with respect to the FBAR obligation and  thus was willful for purposes of the FBAR civil willful penalty.  For a discussion of the Third Circuit’s opinion remanding the case, see Bedrosian on Appeal; Interesting and Potentially Important Opinion on Jurisdiction in FBAR Penalty Cases (12/21/18; 1/10/19), here.  

The remand was to permit the district court to consider the more objective reckless standard (somewhat like a civil willful blindness standard) in determining whether Bedrosian active willfully so as to be subject to the FBAR civil willful penalty.  The  Court made supplemental findings of objective facts that indicated reckless disregard of the FBAR requirements, concluding that its prior opinion for Bedrosian relied almost entirely on Bedrosian’s subjective intent but that consideration of the objective facts,  relied on in other cases by other courts, indicated that Bedrosian acted willfully.   Readers of this blog will know that this objective spin on willfulness for the FBAR civil willful penalty is the clear trajectory of authority.

The opinion is short, so I just refer readers to the opinion.

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