University of Houston School of Law
Tax Fraud and Money Laundering
Spring 2003
Adjunct Professors Campagna and Townsend
Update Materials
Last Updated:
02/09/07
Ch. 1 Introduction.
Ch. 2 The Crimes
This case has been described as the largest criminal tax case in history. The indictment contains forty-five counts. Eighteen defendants await trial. The issues are complex. The evidence is mountainous. According to the latest account, the government has produced over 22 million pages in discovery, much of it in electronic form that may be used effectively only with the assistance of electronic evidence consultants. n3 No end to the document production is in sight. In addition, the government has named 68 trial witnesses n4 and identified 5,024 trial exhibits amounting to over 128,000 pages. Estimates of the duration of the trial range from a low of four to a high of eight months or more.
I have taken the charges in Stein and overlayed them to the facts of Frank Lyon Co. v. United States, 435 U.S. 561 (1978), a case that should be familiar to those of you who have studied substantive tax law. Frank Lyon, was a low point in Supreme Court jurisprudence -- certainly tax jurisprudence -- blessing one of the more gossamer tax shelters. The major charge in Stein -- Count One of the indictment -- is conspiracy to commit a specific offense (tax evasion) and conspiracy to defraud the United States by impairing and defeating the lawful functions of the IRS. In the text for this class, I discuss the defraud conspiracy in some detail. What I tried to do with this draft indictment in Frank Lyon is to show that the sweeping claims for the defraud conspiracy that the Government makes in the Stein case could have applied equally to the Frank Lyon facts. In Frank Lyon, the Supreme Court ultimately blessed the shelter on the tax merits. But if the Government had proceeded first by way of indictment and made the sweeping claims it makes in Stein, could it have convicted the parties on a fact pattern ultimately sustained civilly by the Supreme Court? Consider this draft indictment for what you think it may be worth in the context of the materials in the text with respect to conspiracy.
Ch. 3 Sentencing and Related Issues
Ch. 4 Other Consequences
Ch. 5 Statutes of Limitation
Ch. 6 Venue
Ch. 7 Enforcement Strategies, Policies and Practices
Ch. 8 Information Gathering Techniques
Ch. 9 Mitigating the Damages
Ch. 10 Proof Issues
Ch. 11 The Process A to Z
Ch. 12 Policy Issues
Miscellaneous
Federal Rules
Criminal Procedure:
Cornell Law
School
Cornell also offers the Federal Rules for download at a small cost.
House Judiciary Committee
Evidence
Cornell Law School
House Judiciary Committee
LEXIS-NEXIS Criminal Laws and Rules - This is a CD ROM that provides easy access to many, if not most, federal criminal statutes (including procedural statutes), as well as the various federal rules (criminal procedure, evidence, appellate procedure and Supreme Court) and key criminal cases. The obvious deficiency in the disk is that it does not include the Sentencing Guidelines. Otherwise, it is quite an excellent product and relatively inexpensive and uses a great program (Folio Views) to access and search the information.
Tax Analysts
One Disc - This is a CD ROM product that can be obtained in monthly, quarterly or annual editions. It is principally aimed at the civil tax market, but does have the Internal Revenue Code (which has the tax specific crimes), all tax cases (including criminal tax cases), and developments in tax areas generally (as well as specifically in the criminal tax area). This also uses the Folio Views program.
Internal Revenue Manual - This is a CD-ROM product with the IRM, including Ch. 9 dealing with Criminal Investigations. The IRM can be reviewed on the internet free of charge as noted above.
Texts
Ian Comisky, Lawrence Feld, Steven
Harris, Tax Fraud & Evasion (2 vols.)
Vol. 1:
Offenses, Trials, Civil Penalties
Vol. 2: Money
Laundering, Asset Forfeiture, Sentencing
Michael Saltzman, IRS Practice and
Procedure
Department of Justice
Criminal Tax Manual -
HTML &
PDF.
Tax
Division Home Page
Internal Revenue Service
Criminal Investigation Division:
CI
Home Page
Investigative Areas
Internal Revenue Manual
Ch.
9 - Criminal Investigation
United States Sentencing Commission
Additional