IRS Revs up Whistleblower Program, under Senate Pressure
Accounting Today - 7 hours agoIRS Commissioner Doug Shulman wrote a letter to Grassley this month, saying that the Whistleblower Office has approved over 90 awards so ...
Could Romney Get Audited?
AlterNet - Jul 24, 2012In 2009, IRS Commissioner Doug Shulman announced that the IRS had created a new task force to audit people he called "global high wealth individuals.
Note that both hedge fund money launderer Douglas Shulman and Mary Schapiro are white people whose Jewish parents and co-religionists lied to them from childhood about being 'Semites' and that their ancestors originated in Palestine -complete lies ! And as you can see below before Bill Parish's open letter to both of them,they did indeed self enrich themselves as members of FINRA the former NASD whose legal name and legal by laws no doubt they changed to convenience themselves and their Jewish and Zionist brethren and money launderers,before selling over 20% to the Sheik Mohamed Al Rahid bin Maktoum even knowing or BECAUSE he colluded in allowing money to be sent to Saudi 9/11 suspects training at Jeb Bush's pal Wally Hilliard terrorist and drug trafficking flight school at Huffman Aviation in Venice,Florida which was known for its CIA and drug trafficking history long before that !
YOU CAN NOTE BY NAMES OF THOSE WHO OFFICIALLY REPRESENT NASDAQ THAT THE JEWISH-ZIONIST CONTROL OF NASDAQ IS STILL IN FORCE ONLY IT IS NOW GREATLY LOCATED OFFSHORE TO MAKE POLICING BY AMERICANS DEFRAUDED MUCH MORE DIFFICULT THANKS TO BARACK OBAMA'S SEC Chair Mary Schapiro and W Bush and Obama's IRS Commissioner Douglas Shulman..Mary Schapiro's intimate ties to Israeli money launderer Bernie Madoff as only one example as well as Douglas Shulman's connections to offshore hedge fund money laundereres as well as being one himself is outrageous ! The fact they both profited by selectively selling the former American based NASDAQ to Sheik Mohamed Al Rashid bin Maktoum the dictator of the Dubai money laundering state that allowed over $100,000 to be sent to Mohamed Atta at the Huffman Aviation flight school in Venice,Florida pre 9/11 IS PROOF THAT IN THE POSITIONS THEY HOLD THEY ARE NOT ONLY DANGEROUS TO AMERICANS POCKET BOOKS BUT TO AMERICANS' LIVES.
Finra execs got $11.6M in 2009 amid pay criticism - InvestmentNews
www.investmentnews.com/article/20101004/FREE/101009979
Oct 4, 2010 – S&P 500. 1356.78. 22.02 (1.65%). Nasdaq. 2908.47. 42.28 (1.48%) ... to the U.S. Securities and Exchange Commission, and Douglas Shulman, who left ... Former CEO Mary Schapiro, now SEC chairman, received the biggest ...http://www.indymedia.org.nz/article/74968/911usirssecag-mukaseyhomeland-security-m
9/11:U.S.IRS,SEC,AG Mukasey,Homeland Security Michael Chertoff,Israeli ICTS International Fraud
Who within the U.S. IRS IS RESPONSIBLE FOR TERMINATING AN INVESTIGATION INTO TAX EVASION BY THE CRIMINALS OF ICTS INTERATIONAL !? ? ICTS evecutive Menachem Atzmon was even convicted in his own country of Israel for the equivalent of money laundering between Israeli government accounts Ariel Sharon's and his own Likud Party.And then the U.S. government allowed him and his far right Israeli partners to enter the U.S. and set up a stock 'securities' scam on the NASDAQ that defrauded American investors in order to buy Huntleigh airport rent-a-cops corp that conveniently had the contract to guard Boston's Logan Airport PRE 9/11 ! And I presume you know the results of that fiasco !..
IRS' Commissioner Douglas Shulman,friend to offshore tax avoidence,stock fraud money laundering
Douglas
Shulman
http://online.wsj.com/article/SB119395893426479808.html?mod=googlenews_wsj
IRS Candidate Emerges
November 2, 2007
WASHINGTON -- A top executive with a nongovernmental regulator of U.S. securities firms has emerged as a leading candidate to head the Internal Revenue Service.
..........................................................................
What a joke.It is a penny stock fraud aider and abettor,Douglas Shulman, and no doubt porofiteer of this criminal enterprise of using worthless U.S. penny stocks and offshore accounts to manipulate them from and send U.S. citizens assetts to anonymous offshore accounts - they have worse odds with U.S. penny stocks than gambling slots in Las Vegas and W Bush's U.S. IRS Commissioner knows this - cause he'sa in the business ! Just note his past 'job' experience as 'a vice president at private equity firm Darby Overseas Investments Ltd.',for instance ! The IRS Commissioner's job has been offshore accounts in low tax haven and corrupt money laundering islands and nations !
U.S. penny stock criminals are his colleagues !And W Bush appoints him as head of the U.S. IRS to aid the Bush regimes offshore money laundering sponsers who are the same as Douglas Shulman anonymous criminal offshore clients !In other words the boys from Israel running offshore money laundering with U.S. penny stock ops and pumps and dumps such as
Israeli Prime Minister Ehud Olmert's pals at ICTS International who expect Shulman to give them a $2 million + tax refund on money they stole in the OTCBB penny stock fraud market that Shulman has also pretended(lied)to 'regulate' - certainly have a friend in the fellow insider to international U.S. penny stock fraud with Shulman as head of the IRS !
SO NOTE the very very head of the IRS Commissioner Shulman who should have the greatest incentive in regulating offshore accounts IS A PERSON WHOSE VERY CORRUPT U.S. PENNY STOCK CONNECTIONS PUT HIM AT A CONFLICT OF INTEREST TO PERFORM HIS IRS RESPONSIBILITIES !It is his clients very offshore accounts in the Caymans,Bermuda, Lichtenstein, Israel, Ise of Man and around the world that should be searched for unpàid taxes !
Believe me it is a bad nightmarish joke that offshore PROMOTING scum like Shuman have now taken over the IRS.
................................................................................................................
IRS Candidate Emerges
November 2, 2007
WASHINGTON -- A top executive with a nongovernmental regulator of U.S. securities firms has emerged as a leading candidate to head the Internal Revenue Service.
Douglas Shulman, 40 years old, vice chairman of the Financial Industry Regulatory Authority, is under strong consideration to be named IRS commissioner, according to a person familiar with the situation.
The IRS has been without a permanent commissioner since April, when Commissioner Mark Everson resigned to become president and chief executive officer of the American Red Cross. Linda Stiff, a senior IRS official who headed operations support, is serving as acting commissioner.
Mr. Shulman is the former chief of staff for the National Commission on Restructuring the Internal Revenue Service, a bipartisan commission appointed in the mid-1990s to study problems at the IRS such as its outdated computer system. He was cofounder and executive vice president of FoundryOne Inc., a technology investment firm. Before that, he served as a vice president at private equity firm Darby Overseas Investments Ltd.
Mr. Shulman's candidacy was reported first by the Washington Post yesterday.
An aide to Shulman declined comment.
White House spokeswoman Emily Lawrimore also declined comment but said, "We're looking forward to announcing the nominee as soon as possible."
..........................................
http://209.85.165.104/search?q=cache:WR0GuK59MbYJ:www.finra.org/AboutFIN...
Douglas Shulman
Vice Chairman
Finra
Douglas Shulman is Vice Chairman of FINRA, where he has broad responsibility for strategy, services and operations. He oversees the organization's technology, registration and disclosure, and industry testing and continuing education. He also is responsible for FINRA's market transparency facilities (OTCBB, TRACE, TRFs and ADF). He leads FINRA's strategic planning and international efforts. Mr. Shulman also has broad-based responsibilities for working with FINRA's membership to ensure effective firm input into FINRA's activities, and oversees FINRA's compliance services and member relations departments.
Douglas
Shulman
http://online.wsj.com/article/SB119395893426479808.html?mod=googlenews_wsj
IRS Candidate Emerges
November 2, 2007
WASHINGTON -- A top executive with a nongovernmental regulator of U.S. securities firms has emerged as a leading candidate to head the Internal Revenue Service.
..........................................................................
What a joke.It is a penny stock fraud aider and abettor,Douglas Shulman, and no doubt porofiteer of this criminal enterprise of using worthless U.S. penny stocks and offshore accounts to manipulate them from and send U.S. citizens assetts to anonymous offshore accounts - they have worse odds with U.S. penny stocks than gambling slots in Las Vegas and W Bush's U.S. IRS Commissioner knows this - cause he'sa in the business ! Just note his past 'job' experience as 'a vice president at private equity firm Darby Overseas Investments Ltd.',for instance ! The IRS Commissioner's job has been offshore accounts in low tax haven and corrupt money laundering islands and nations !
U.S. penny stock criminals are his colleagues !And W Bush appoints him as head of the U.S. IRS to aid the Bush regimes offshore money laundering sponsers who are the same as Douglas Shulman anonymous criminal offshore clients !In other words the boys from Israel running offshore money laundering with U.S. penny stock ops and pumps and dumps such as
Israeli Prime Minister Ehud Olmert's pals at ICTS International who expect Shulman to give them a $2 million + tax refund on money they stole in the OTCBB penny stock fraud market that Shulman has also pretended(lied)to 'regulate' - certainly have a friend in the fellow insider to international U.S. penny stock fraud with Shulman as head of the IRS !
SO NOTE the very very head of the IRS Commissioner Shulman who should have the greatest incentive in regulating offshore accounts IS A PERSON WHOSE VERY CORRUPT U.S. PENNY STOCK CONNECTIONS PUT HIM AT A CONFLICT OF INTEREST TO PERFORM HIS IRS RESPONSIBILITIES !It is his clients very offshore accounts in the Caymans,Bermuda, Lichtenstein, Israel, Ise of Man and around the world that should be searched for unpàid taxes !
Believe me it is a bad nightmarish joke that offshore PROMOTING scum like Shuman have now taken over the IRS.
................................................................................................................
IRS Candidate Emerges
November 2, 2007
WASHINGTON -- A top executive with a nongovernmental regulator of U.S. securities firms has emerged as a leading candidate to head the Internal Revenue Service.
Douglas Shulman, 40 years old, vice chairman of the Financial Industry Regulatory Authority, is under strong consideration to be named IRS commissioner, according to a person familiar with the situation.
The IRS has been without a permanent commissioner since April, when Commissioner Mark Everson resigned to become president and chief executive officer of the American Red Cross. Linda Stiff, a senior IRS official who headed operations support, is serving as acting commissioner.
Mr. Shulman is the former chief of staff for the National Commission on Restructuring the Internal Revenue Service, a bipartisan commission appointed in the mid-1990s to study problems at the IRS such as its outdated computer system. He was cofounder and executive vice president of FoundryOne Inc., a technology investment firm. Before that, he served as a vice president at private equity firm Darby Overseas Investments Ltd.
Mr. Shulman's candidacy was reported first by the Washington Post yesterday.
An aide to Shulman declined comment.
White House spokeswoman Emily Lawrimore also declined comment but said, "We're looking forward to announcing the nominee as soon as possible."
..........................................
http://209.85.165.104/search?q=cache:WR0GuK59MbYJ:www.finra.org/AboutFIN...
Douglas Shulman
Vice Chairman
Finra
Douglas Shulman is Vice Chairman of FINRA, where he has broad responsibility for strategy, services and operations. He oversees the organization's technology, registration and disclosure, and industry testing and continuing education. He also is responsible for FINRA's market transparency facilities (OTCBB, TRACE, TRFs and ADF). He leads FINRA's strategic planning and international efforts. Mr. Shulman also has broad-based responsibilities for working with FINRA's membership to ensure effective firm input into FINRA's activities, and oversees FINRA's compliance services and member relations departments.
http://milwaukee.indymedia.org/en/2008/02/209233.shtml
9/11:U.S.-Israeli Dept. Of In-Justice.IRS,ICTS International Fascists Vs.Wesley Snipes
Tony Ryals, 17.02.2008 23:06
Maybe the IRS fears the Israeli boys of ICTS International may become distracted or stressed again themselves if they aren't allowed to run their U.S. penny stock frauds unmolested on American taxpayers - and perhaps one of the next flights they are in charge of may 'accidentally' crash into the IRS building. Whereas with black actor Wesley Snipes - they can handle him - and make an example of him while those reponsible for 9/11 and major fraud against U.S. CITIZENS GET A ' FREE PASS'. Israeli Prime Minister Olmert should be required to order his boys to stand down or else !
http://www.orlandosentinel.com/news/local/crime/orl-snipes2508jan25,0,50... These scumbags (ICTS International)even tried unsuccessfully to scam $2 million from the U.S. IRS ! In fact any money these criminals and in my opinion suspects in the 9/11 disaster that in the end has costs America perhaps trillions of dollars - has come from defrauding Americans and thus decreasing the tax base and taxable income in America ! I know for a fact I was paying taxes on income till I lost the capital that accrued interest to criminals with offshore accounts in the Caymans or Bermuda or Kuala Lumpur or Dubai or Israel to U.S. PENNY STOCK CRIMINALS SUCH AS MR.ATZMON AND HIS ISRAELI MAFIA ! The U.S. IRS AND TTHE U.S. SEC CAN CONFIRM THAT IF THEY WISH ! They shouldeven be able to tell me where and to whom my money went - IF THEY WISH !
Before writing the above I had not read this:
http://www.investor.news.com/Engine... ICTS International N.V.: IRS Withdraws Criminal Investigation
Business Wire News ReleasesPublished: 01/14/08 04:03 PM ESTReleased By:
ICTS International N.V.
Related Stocks:
ICTSF
ICTS International N.V. (ICTSF. OB), a leading provider of advanced security services, is pleased to report that it has been advised that the Internal Revenue Service has withdrawn the criminal investigation. Mr. Menachem Atzmon, the Chairman of the Supervisory Board of ICTS, stated that, "I am pleased that at last we have been vindicated that we have not done anything wrong. The Company will now take all necessary steps to recover the $2.5 million refund claim that the Company is entitled to. The Company is moving forward in all fronts and we are very optimistic as to the future." .......
However the racist Israelis in control of the IRS can take the time to harrass a struggling black American actor of what amounts to chump change compared to the amount Menachem Atzmon the or Israeli Shin Bet government terrorists of ICTS International stole from American investors while at the same time being the cause of 9/11 WTC tragedy and mass murder according to the U.S.government itself by allowing flights 11 and 175 to leave from Logan Airport on 9/11/01 with Mohamed Atta and the alledged Saudi Arabian terrorists on board enroute to their collision with the WTC in NYC !:
Feds: Wesley Snipes played role of tough guy versus IRS
Stephen Hudak | Sentinel Staff Writer
January 25, 2008
OCALA - Film star Wesley Snipes responded to his tax-evasion indictment in 2006 with a 29-page letter to the Internal Revenue Service that was filled with anti-tax rhetoric and warned that agents could face "collateral risk" for hounding him, according to key testimony in the government's case Thursday.
But defense lawyer Robert Barnes downplayed the actor's opus, which included 600 pages of supporting documents.
Snipes, a graduate of Jones High School, is charged with conspiracy to defraud, filing a fraudulent claim and six counts of willfully failing to file federal income-tax returns..
He remained cheerful Thursday, emerging from the courthouse and pausing briefly to smile for pictures and sign autographs
....................................................................
Stephen Hudak | Sentinel Staff Writer
January 25, 2008
OCALA - Film star Wesley Snipes responded to his tax-evasion indictment in 2006 with a 29-page letter to the Internal Revenue Service that was filled with anti-tax rhetoric and warned that agents could face "collateral risk" for hounding him, according to key testimony in the government's case Thursday.
But defense lawyer Robert Barnes downplayed the actor's opus, which included 600 pages of supporting documents.
Snipes, a graduate of Jones High School, is charged with conspiracy to defraud, filing a fraudulent claim and six counts of willfully failing to file federal income-tax returns..
He remained cheerful Thursday, emerging from the courthouse and pausing briefly to smile for pictures and sign autographs
....................................................................
April 24, 2008 -- Updated 0053 GMT (0853 HKT)
Snipes gets the max -- 3 years -- in tax case
OCALA, Florida (CNN) -- Actor Wesley Snipes was sentenced
Thursday to three years in prison for three misdemeanor counts of
failing to file tax returns -- the maximum requested by federal
prosecutors.
"Snipes' long prison sentence should send a loud and crystal clear
message to all tax defiers that if they engage in similar tax defier
conduct, they face joining him," said Assistant Attorney General Nathan
J. Hochman of the Justice Department's Tax Division.
Internal Revenue Service Commissioner Douglas Shulman said the law is clear on taxes.
"There is no secret formula that eliminates a person's tax obligations, nor are there any special exceptions," he said.
"The majority of Americans pay their taxes timely and accurately. Those who willfully violate the law must be held accountable."
In a civil suit, the IRS is seeking repayment of all taxes and interest from Snipes.
Federal prosecutors said the actor for nearly a decade escaped paying more than $15 million in income tax returns by sending money to overseas accounts, though they acknowledged in court that the amount is in dispute.
Before the sentencing, the actor asked the court to show mercy and offered three checks totaling $5 million as a gesture of good will.
Federal prosecutors diverted the checks to the U.S. Treasury -- which accepted the payment -- but it wasn't enough.
"It's essentially a down payment, but a fraction of what he owes," said Assistant U.S. Attorney Scotland Morris.
Snipes' attorneys -- who had argued he should get probation or house arrest -- said they will appeal the sentence.
.....................
The above treatmwent of Amewrican Leslie Snipes is outrageous in light of the Swiss and other offshore bank accounts that IRS Commisioner Douglas Shulman has protected for his cronies who are all involved in stock frauds and often corporate sabotage against America itself of which the Israeli terrorists of ICTS International whose 'incompetence' at best took the lives of 3000 Americans, followed by many more in Iraq and Afghanistan,is an outstanding example
Internal Revenue Service Commissioner Douglas Shulman said the law is clear on taxes.
"There is no secret formula that eliminates a person's tax obligations, nor are there any special exceptions," he said.
"The majority of Americans pay their taxes timely and accurately. Those who willfully violate the law must be held accountable."
In a civil suit, the IRS is seeking repayment of all taxes and interest from Snipes.
Federal prosecutors said the actor for nearly a decade escaped paying more than $15 million in income tax returns by sending money to overseas accounts, though they acknowledged in court that the amount is in dispute.
Before the sentencing, the actor asked the court to show mercy and offered three checks totaling $5 million as a gesture of good will.
Federal prosecutors diverted the checks to the U.S. Treasury -- which accepted the payment -- but it wasn't enough.
"It's essentially a down payment, but a fraction of what he owes," said Assistant U.S. Attorney Scotland Morris.
Snipes' attorneys -- who had argued he should get probation or house arrest -- said they will appeal the sentence.
.....................
The above treatmwent of Amewrican Leslie Snipes is outrageous in light of the Swiss and other offshore bank accounts that IRS Commisioner Douglas Shulman has protected for his cronies who are all involved in stock frauds and often corporate sabotage against America itself of which the Israeli terrorists of ICTS International whose 'incompetence' at best took the lives of 3000 Americans, followed by many more in Iraq and Afghanistan,is an outstanding example
Super rich hold $32 trillion in offshore havens
LONDON |
The study estimating the extent of global private financial wealth held in offshore accounts - excluding non-financial assets such as real estate, gold, yachts and racehorses - puts the sum at between $21 and $32 trillion.
The research was carried out for pressure group Tax Justice Network, which campaigns against tax havens, by James Henry, former chief economist at consultants McKinsey & Co.
He used data from the World Bank, International Monetary Fund, United Nations and central banks.
The report also highlights the impact on the balance sheets of 139 developing countries of money held in tax havens by private elites, putting wealth beyond the reach of local tax authorities.
The research estimates that since the 1970s, the richest citizens of these 139 countries had amassed $7.3 to $9.3 trillion of "unrecorded offshore wealth" by 2010.
Private wealth held offshore represents "a huge black hole in the world economy," Henry said in a statement.
(Reporting by Chris Vellacott)
..........................
You can be sure not only Mary Schapiro knolws Bernie Madoff who was really one of her mentors in corruption and fraud against the American public but also Douglas Shulman must surely be a colleague of
Israeli money lñaunderer Bernie Madoff as well.Note as I emphasized above
'There's Something About Mary' as Madoff Calls Schapiro “a Dear ...
www.senseoncents.com/.../theres-something-about-mary-as-madoff-c...30 Oct 2009 – Did FINRA invest its own funds from its internal investment portfolio with Bernie Madoff? Would FINRA's head Mary Schapiro invest with her ...Bernie Madoff And Mary Schapiro Relationship | Sense on Cents
www.senseoncents.com/.../bernie-madoff-and-mary-schapiro-relation...19 Oct 2009 – Posts Tagged 'Bernie Madoff and Mary Schapiro relationship'. Attorney Richard Greenfield Brands Mary Schapiro and FINRA Execs as “Liars” ...Mary Schapiro's Tenure At FINRA | Sense on Cents
www.senseoncents.com/tag/mary-schapiros-tenure-at-finra/Great American Ed Morrow Lashes Out at Mary Schapiro .... FINRA largely reduces the extensive relationships between Bernie Madoff and family members with ...Mary Schapiro | TPMMuckraker
tpmmuckraker.talkingpointsmemo.com/mary_schapiro/23 Apr 2010 – TPMMuckraker Mary Schapiro. ... And as we noted last week, Finra, under Schapiro, failed to catch Bernard Madoff's alleged "$50 billion ponzi ...Bernard Madoff 'fraud': Obama to appoint Mary Schapiro as new ...
www.telegraph.co.uk › Finance › Finance Topics › Bernard Madoff18 Dec 2008 – Bernard Madoff 'fraud': Obama to appoint Mary Schapiro as new chairman of ... Mary Schapiro, chief executive of Finra – the Financial Industry ...Is FINRA's Future in Doubt?
wallstreetpit.com/17543-is-finras-future-in-doubt23 Feb 2010 – Mary Schapiro alone received over $3 million, in addition to a ... On information and belief, (1) Bernard Madoff joined NASD's Board of ...Even an internal review conducted by FINRA itself found that the organization missed several key opportunities to investigate the securities fraud by R. Allen Stanford. And while FINRA officials have denied any wrongdoing in the failure to detect Bernard Madoff’s Ponzi scheme, securities law scholar John Coffee testified before Congress that “Madoff’s brokerage business was by definition within…FINRA’s jurisdiction.”
An investigation by The Wall Street Journal further confirmed that FINRA and its predecessor NASD, under the leadership of current SEC Chairman Mary Schapiro, had a decidedly light touch when it came to regulation and enforcement, with significant declines in disciplinary fines assessed, individuals barred, and firms expelled during her time at the organization.
Outrageous Executive Compensation Packages
Despite its countless failures, FINRA’s board has approved outrageous compensation packages for the organization’s senior executives. Tax documents show that in 2008–a year in which FINRA also lost $568 million in its investment portfolio–the organization’s 20 senior executives received nearly $30 million in salaries and bonuses. Mary Schapiro alone received over $3 million, in addition to a lump-sum departing payment worth $7.2 million. FINRA’s decision to reward its senior leadership with seven-figure salaries and bonuses–at a time when many of its larger member firms were getting away with securities violations that brought our financial markets to the brink of collapse–ought to raise serious concerns about granting the organization any additional regulatory authority.
Failure to Warn the Public about Auction Rate Securities
In its 2008 annual report, FINRA described the recent collapse of the auction rate securities (ARS) market:
Auction Rate Securities (ARS) traditionally had been a valuable source of market liquidity, targeted at investors seeking a cash-like investment that paid a higher yield than money market mutual funds or certificates of deposit. But in February 2008, the ARS market froze, leaving some investors unable to access their holdings. The episode prompted an investigation by FINRA that revealed some firms had sold these securities using advertising, marketing materials or other internal communications with its sales force that were not fair and balanced and therefore did not provide a sound basis for investors to evaluate the benefits and risks of purchasing ARS.
Of course, the report omits any mention of the fact that NASD (FINRA’s predecessor) had liquidated its own $647 million ARS investment in 2007 without giving any warning to other investors, who now have tens of billions of dollars stuck in the ARS market. In fact, NASD knew well before then that ARS shouldn’t be treated like cash or cash equivalents, explaining in its 2003, 2004, and 2005 annual reports that it was classifying its own auction rate securities as available-for-sale investments. Yet FINRA neglected to warn the investing public about the risks posed by ARS investments until it was far too late. Congress should at least investigate the circumstances surrounding NASD’s liquidation of its ARS investment before deciding to grant FINRA any additional authority to “protect” investors.
Incestuous Relationship Between FINRA and the Securities Industry
FINRA’s numerous failures should hardly come as a surprise given the incestuous relationship between SROs and the financial services industry. It has been said that the close connection with industry allows self-regulators to respond to industry malfeasance more rapidly than a public entity. However, POGO believes that the cozy relationship between SROs and industry is a major reason why entities such as FINRA have failed to operate as effective regulators.
For instance, Amerivet’s complaint against FINRA points to several connections between NASD and the Madoff family:
On information and belief, (1) Bernard Madoff joined NASD’s Board of Governors in January 1984 and served as Vice Chairman while his Ponzi scheme was well underway, (2) he had previously held a number of NASD committee assignments since the 1970s and was instrumental in the development of NASDAQ, (3) he also headed NASDAQ, (4) his brother, Peter Madoff, served as Vice Chairman of the NASD, (5) Mary Schapiro, former FINRA CEO, appointed Mark Madoff, one of Bernard Madoff’s sons, to the National Adjudicatory Council, a regulatory body that reviews disciplinary decisions made by FINRA, and (6) Bernard Madoff’s niece, Shana Madoff, a “Compliance Officer” of Madoff until the firm’s collapse, was a member of a compliance advisory committee of FINRA.
There were also close connections between FINRA and Stanford Financial Group: Lena Stinson, director of global compliance at Stanford, served on FINRA’s membership committee, while Frederick Fram, chief operating officer of Stanford Group Holdings, served on FINRA’s continuing education committee.
And it appears the financial crisis did nothing to weaken the close ties between FINRA and the securities industry. Even a cursory examination of FINRA’s current leadership paints a clear picture of a regulator that is still captured by the industry it is tasked with regulating. Richard Ketchum is a former General Counsel for the Corporate and Investment Bank at Citigroup, Inc. Robert Errico, FINRA’s Executive Vice President for Member Regulation, is a former Senior Vice President for Capitals Market Oversight at Charles Schwab & Co., and a former General Counsel for Schwab Capital Markets L.P. Susan Merrill, FINRA’s Executive Vice President and Chief of Enforcement, is a former partner at Davis Polk & Wardwell, which represents some of the largest financial institutions in the world. And on FINRA’s Board of Governors, many of the members that are supposed to represent the public’s interest have close ties to the securities industry. Given that SROs such as FINRA are supposed to be the front line overseers for many financial products, POGO believes that the cozy relationships built into this system create a serious conflict of interest.
Investors and Taxpayers Forced to Foot the Bill
In an apparent attempt to sell the idea that FINRA should have more supervisory authority, Richard Ketchum told Congress that “the increased manpower and enhanced investor protection would come at no cost to the taxpayer” because SROs are funded exclusively by the entities they regulate. Unfortunately, this funding system amounts to a user tax on investors in the form of transaction costs. And, of course, taxpayers must foot the bill for the SEC’s oversight of FINRA and other self-regulators, which entails approving SRO rules, monitoring their activities, hearing internal appeals, and overseeing board activities...............
SEC Chief Mary Schapiro Faces Criticism For Madoff-Related Hire
www.huffingtonpost.com/.../sec-chairwoman-mary-schap_n_833430...9 Mar 2011 – SEC Chief Mary Schapiro Faces Criticism For Madoff-Related Hire. Mary Schapiro ... Securities And Exchange Commission · Bernie Madoff ...
http://www.opednews.com/articles/Letter-to-Douglas-Shulman-by-Lawrence-Velvel-090522-542.html
Letter to Douglas Shulman
0 puntos on reddit
By Lawrence Velvel (about the author)
Become a Fan (2 fans) -- Page 1 of 1 page(s)
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May 22, 2009
Via Telecopier and Federal Express
The Honorable Douglas Shulman
Commissioner, Internal Revenue Service
1111 Constitution Avenue, N.W.
Department of Treasury
Washington, DC 20224
Dear Commissioner Shulman:
I
do not know whether you are aware that in July of 2004, in the midst of
Harry Markopolos’ revelations to the SEC that Bernard Madoff was
operating a Ponzi scheme, the Internal Revenue Service placed its
imprimatur on Madoff by approving his company as a non-bank custodian
for IRAs. I am writing to request that you inquire into, inform me, and make public how this happened.
As
you may know, when it enacted the Employment Retirement Income Security
Act of 1974, Congress was deeply concerned over the safety of citizens’
retirement savings. It wished to insure that those who “participate in [retirement] plans actually receive benefits.” To
insure that Americans’ retirement monies were safeguarded, Congress put
the IRS in charge of insuring that fiduciary standards were met by
custodians of retirement plans, IRAs and similar monies. Congress felt
the IRS had previously done well in overseeing fiduciary standards, and
this experience would aid it in future. To assist the IRS in doing this job in future, Congress authorized appropriations of 70 million dollars per year.
Congress
further provided that the IRS could authorize non banks to be the
custodian of IRAs and similar accounts if the non bank provided
“substantial evidence” that “the way in which he will administer”
accounts will be “within accepted rules of fiduciary conduct with
respect to the handling of other people’s money.”
To
carry out Congress’ intent, the IRS has regulations requiring that, to
be an approved non-bank custodian of IRAs, a company has to have a
separate trust department; the assets of different accounts cannot be
commingled; continuity of the company has to be insured by diversified
ownership under which no one individual can own more than fifty percent
of its shares; the company has to keep customers’ assets in a vault; and
the company’s fiduciary records have to be kept separate from other
records. The IRS also ruled that, in order to carry out
its function of safeguarding the owners of IRAs, pension funds and
similar monies, it has a right to inspect the books and records of any
company that wishes to become or already is an approved non-bank
custodian.
Despite
Congress’ intent that it safeguard retirement monies, and despite its
own regulations, in 2004 the IRS approved Madoff as a non-bank custodian
of IRAs even though he was fraudulently stealing retirement monies
from IRAs and even though he was in violation of the IRS’ own
regulations. Among the violations of the IRS’ regulations were these: Madoff had no separate trust department. One man, Bernard Madoff, owned 90 to 100 percent of the company rather than less than fifty percent. (The Trustee, Irving Picard, has said in a complaint that Bernard Madoff’s company was “wholly owned” by him.) There was no vault -- and an inspection would have shown there also were no securities to put in a vault. All
the customers’ assets were commingled since Madoff stole them all for
his own use instead of keeping securities in separate accounts. And had the IRS done its job, it also would have learned that, for at least fifteen years or so, Madoff had previously operated as a non-approved non-bank custodian for tens or scores of IRAs and as a non-approved non-bank subcustodian for hundreds of others. These
discoveries would have necessarily caused the IRS to uncover and blow
the whistle on Madoff’s fraudulent conduct instead of approving him as a
non-bank custodian of IRAs in 2004.
The question which arises, of course, is how did this occur. How did the IRS come to approve Madoff in 2004? Did it conduct no investigation, but simply rubber stamp his application to be a non-bank custodian? Were there bribes or other criminal conduct involved? Was the IRS influenced somehow or other by the SEC. It seems inconceivable that the IRS could have approved Madoff. Yet it did. How did this happen?
As said, I request that you conduct an investigation of this, let me know the answer(s), and make the answer(s) public. It
is no trifling matter when the Internal Revenue Service seems to have
abetted the largest fraud in history by approving Madoff to be a
non-bank custodian of retirement monies. It is no trifling matter when the IRS did this in violation of the intent of Congress and its own regulations. Those
who lost money, the Congress, and the entire country have a right to be
told the answer(s) to the question of how did this awful thing happen.
Sincerely yours,
Lawrence R. Velvel
Lawrence R. Velvel is a cofounder and the Dean of the Massachusetts
School of Law, and is the founder of the American College of History and
Legal Studies.
Interesting 'coincidence' that investment advisor Bill Parish adressed his letter below regarding shoddy
or non existent cash flow statements to both SEC Chair Mary Schapiro who is an old Bernie Madoff cronie who specialized in stealing American money and laundering it for the racist and religionist Israeli police and war state,as well as to her colleageue in hedge fund,(offshore),securities fraud who W Bush appointed as IRS Commissioner and who Barack Obama aka Barry Soetoro in his 'wisdom' and Zionist corruption kept there.No wonder all those Swiss bank accounts he should have busted and whose stolen stock or securities fraud profits sgould have been repatriated to U.S. have remained protected.Mary Schapiro and Doug Shulman who further welf enriched themselves by selling the NASDAQ to the Sheik Mohamad Al Rashid
bin Maktoum of Dubai and his Zionist or Israeli bosses is just one more example of why people of the Jewish religion should NOT be allowed to dominate international and particularly U.S.finances as if we still lived in the Medieval European Dark Ages whern only Jews were allowed to perfoem usary or provide loans at interest.This nasty habit has also allowed them the cash to by our media as well and dominate our 'news' which has degenerated into pro Israel propaganda and brainwashing of the masses.
Note problems Bill Parish has had with NY Times 'reporters' who becasuse it bis owned by Zionists who lied about WMDS in Iraq and who also covered up Israelis involved in 9/11/01 led to the death of 3000 Americans in NY on 9/11 followed by hundreds of American troops dead and thousands injured for life !
Bill Parish – Parish & Company Investment Management
Financial, Economic, Political & Media Observations. a Local Investment Management Presence with a Global Perspective (see company website at www.billparish.com)
** June 7, 2011 ** Letter to SEC Chair and IRS Commissioner – Tax Deduction Pyramid Scheme
June 7, 2011 by Bill Parish
Parish & Company
10260 S.W. Greenburg Rd., Suite 400
Portland, OR 97223
Tel:(503)643-6999 Fax:(503)293-3507
Email: bill@billparish.com
April 15, 2011
Mary Schapiro
Office of the Chairman
Securities and Exchange Commission
Mail Stop 1070
100 F Street NE
Washington, D.C. 20549
cc: Elise B. Walter – SEC Commissioner
Troy A. Parades – SEC Commissioner
Robert Khuzami – SEC Director
Doug Shulman – IRS Commissioner
Heather Maloy – IRS Commissioner Large Business Division
Walter Harris – IRS Director Financial Services
Elise Bean – Congressional Oversight Committee
Dear Chair Schapiro,
In 15 years as an investment advisor I have always done my best to support the SEC’s work, having led many key corporate governance related initiatives. Past Chairs Levitt, Pitt and Donaldson are all familiar with my work, which has also been reported in front page stories in leading publications including Bloomberg, the New York Times, Barrons and USA Today.
The purpose of this letter today is to alert you directly to an alarming trend with respect to the rapidly eroding integrity of cash flow statements filed with the commission. The culprit is non-disclosure of important tax related transactions involving material net operating losses, in addition to compensation and related expense allocations subject to the “fractions rule”and NOL loss limitation rules that are material to past, present and future cash flows involving publicly traded partnerships, such as Blackstone, in which tax exempt investors participate. The NOL related limitation issues are also a significant issue in mergers and buyouts of public companies.
Back in late 1999 when I provided original research to Gretchen Morgenson, David Cay Johnston and Floyd Norris of the NY Times regarding how Microsoft paid no federal income tax I was told that this was ridiculous. You discredit your excellent work by saying such a thing, Morgenson added. Six months later she did a front page story outlining the scheme involving the issuance of NQ stock options. Similarly Bob Herdman, Chief Operating Officer at the Commission, thought the idea ridiculous at first.
While everyone was focused on the future dilution of options, my focus was instead on the historic tax based cash flow impact of options. What made this original research possible was a cash flow statement that analyzed cash flow and, in conjunction with footnotes, provided a good general idea of tax related impacts.
More recently, since last summer, I have tried to get the NY Times to do a story on how major private equity and hedge funds may indeed be escaping taxation completely via gaming carried interest deductions in violation of two key IRS reforms established by former President Reagan, the “fractions rule”and limitations on purchased NOLs.
The Times chose to focus on publicly traded GE and in their story never fully highlighted how GE is using NOLs. How could the Times put their reputation on the line based upon my work without adequate SEC disclosure? Also interesting to note is that at one time over the last two years, one private equity firm, Harbinger, owned more than 10 percent of the NY Times. Similarly, per Yahoo finance, JP Morgan owns almost 10 percent of Gannett, parent to USA today.
Media consolidation and outright ownership of media by major financial institutions, including private equity and hedge funds that have bitterly fought to undermine both the SEC’s and IRS efforts, has complicated this task. Perhaps now is a good time for the SEC and IRS to be more vigilant and oriented at making news aimed at solving fundamental problems before they accumulate and lead to major market problems. While leading attorneys at major law firms representing the private equity crowd enjoy great access with top officials via conferences and other venues, independent advisors like myself with a distinguished record can barely get a phone call returned.
GE was low hanging “media fruit” so to speak. Clearly the much bigger issue is that involving the takeover of public companies by private equity and hedge funds, effectively converting these formerly tax paying entities to the equivalent of tax exempts using NQ option and carried interest schemes resulting in an NOL pyramid scheme. Again, the bulk of these NOLs were never cash expenses but simply NQ options and carried interest.
If these private equity and hedge funds were indeed catering only to affluent investors that would be fine yet today many of these organizations receive most of their funding from public pensions. I have written about this extensively over the last 5-7 years and pushed hard to get the concept behind carry fees fully understood and disclosed. Again, numerous examples of this work appear in major publications.
One of the big lessons of the dot.com era was the need for the SEC to collaborate more with the Federal Reserve and see the economic impact of accounting irregularities. Most notable of course back then were merger and stock option accounting related issues. Former San Francisco Fed President Robert Parry told me, look Bill, “accounting issues were not in the fed’s purview” in late 1999. This was when the market was more focused upon whether Alan Greenspan took a bath before a meeting of the Federal Reserve.
The key lesson in the recent crisis involving mortgage financing and related derivatives was of course that conflicts of interest with key regulators and rating agencies can lead to similarly disastrous results. If Moody’s had done their job, we would have had no crisis. Also germane was the impact of top government officials such as Robert Rubin moving to industry and aggressively attacking important safeguards, Glass-Steagall in his case.
The reason I have copied your former colleague at FINRA, current IRS Commissioner Doug Shulman, is that to date there has been almost no discussion regarding how tax policy played a major role in both crises and in my opinion, with the proposed repeal of the fractions rule, could ignite the next. My work in this area goes back to 1999.
My hope is that you will work together to restore integrity in what is clearly the most important disclosure of all for any public company, the cash flow statement and related footnotes. Doing so will also greatly enhance overall tax equity, in my judgement. The notion that major tax related impacts not be disclosed is a significant fraud upon all statement users and puts the whole system at risk.
More specifically, someone at the Treasury has proposed repealing the fractions rule in the 2012 revenue guidelines. To that, I only have the following thoughts: Robert Rubin/Glass-Steagall; Wendy Graham/Derivatives Deregulation. It is absolutely ridiculous when it was such an important reform and there has been almost no enforcement of it for years, perhaps not unlike mortgage underwriting standards. The industry failed in Congress and failed to get an American Bar Association sponsored revenue ruling ,yet now it the Treasury itself advocating the repeal of the fractions rule.
While some companies will argue rightfully that tax returns are private and not required to be disclosed, such material NOL and “fractions rule” related information must be disclosed when public firms are taken private or in the event of significant sales or mergers. This is fundamental accounting 101. Some would add that failure to do so is the very essence of fraud because it fuels the notion that investing is an insider’s game. What it also does is allow problems to accumulate and ultimately exacerbate major problems in the market.
These cash flow based disclosures are vital information to an SEC Registered advisor like myself, and other investors. And for the last couple of years I have found increasing frustration in dealing with leading journalists because they are simply not getting the mandatory public disclosure required to corroborate my research findings and forward key corporate governance initiatives.
A good recent example is the General Electric sale of NBC to Comcast. So why do these two completely independent firms get to “game the system” with respect to the allocation of net operating losses belonging to GE via a special allocation partnership, subsequent to a sale of the business? One might ask, is this a fraud upon taxpayers, investors, both or simply much ado about nothing? When I make such an observation to a leading journalist, they need to be able to see a footnote that confirms or refutes my claim. This is as basic as corroborating total revenues per the income statement.
It is understandable that many journalists have expressed no interest in covering the proposed repeal of the “fractions rule,”simply because they don’t understand it. The reason of course is that these public partnership firms are not providing adequate disclosure to the SEC. In addition, something appears very amiss at the Treasury department. Who is behind this repeal, really? If you do a search of Blackstone’s 10K you will find no references to the fractions rule, nor related financial adjustments made to confirm to it. Similarly, no one at the Internal Revenue Service is willing to discuss this. (See attached letter to Curt Wilson, Associate General Counsel Passthroughs at the IRS).
At http://billparish.wordpress.com you can also see a blogpost that features a brief audio, taken from an American Bar Association Conference in which one of the nations leading attorneys, Sanford Presant, explains how investors received $7 in tax deductions for each $1 invested prior to the fractions rule. Also included is a brief audio clip from a top IRS official, Curt Wilson, who volunteered to sit on a panel, noting he sees no enforcement issues with the “fractions rule.”
“How can we transfer our angst over the fractions rule to you,”a King and Spaulding attorney asked the IRS’s Wilson? Wilson later told me that the fractions rule was not being considered for repeal yet it is now in the 2012 Revenue Guidelines for repeal. Wilson will not confirm who is involved in the repeal nor its specifics. Again, in my mind this will be the genesis of a crisis if not prevented, similar to the repeal of Glass-Steagall or the rules regarding derivatives trading.
Per my analysis, firms with inadequate cash flow disclosure to the commission with respect to NOL and fractions rule related considerations include, but are not limited to Bank of America, Goldman Sachs, JP Morgan Chase, Morgan Stanley, Citigroup, General Electric, Comcast, Blackstone, KKR, TPG (via acquisitions including J Crew since TPG is not publicly traded), Apollo and Fortress.
For example, if Blackstone is going to purchase a publicly traded company and thereby assumes significant accumulated NOLs, those valuable NOLs must be disclosed fully to existing shareholders prior to a sale. In addition, the same partnership must disclose the impact of the fractions rule, specifically, how much of the deductions cannot be taken due to having tax exempt investors in the purchasing partnership. Such investors often represent more than 80 percent of all funds in major private equity partnerships.
Also relevant are the limitations on the deductibility of purchased NOLs, and whether they are being fully deducted using a reverse scheme, in which an entity with significant NOLs purchases a firm paying significant taxes, thereby escaping the required amortization reform put forth by Reagen. My original research identified this scheme in 2001 subsequent to the takeover of Time Warner by AOL.
It is not enough to say, we need not disclose such information since it is an item on our tax return. Full disclosure and materiality mandate such disclosure of material tax driven cash flow items directly on the cash flow statement or in the footnotes.
In another example, if TPG purchases J Crew and by doing so receives $1 billion in net operating losses, a large part of which are tax deductions created from stock options, how are these valuable net operating losses treated. These expenses never resulted in a cash outlay, and if the partnership at TPG buying J Crew has 80 percent tax exempt investors, are these NOLs being stripped away in violation of the fractions rule prior to being put in the partnership? And, if so, is this not a violation of the fractions rule resulting in a LILO like leasing doubling up of tax deductions for taxable general partners, etc?
One could argue such non-disclosure to the SEC is manufacturing a tax deduction pyramid or flipping scheme in which private equity firms take companies private, public, private again and then public. Each time creating staggering NOLs in the form of stock option or carried interest deductions, not resulting from an outlay of cash for equipment or wages, but rather a paper tax deduction pyramid scheme.
Regarding Blackstone, another potential issue includes the valuation of partnership interests that create valuable tax deductions? Are these straight up or are they the equivalent of a stock option back dating scheme being used that is aimed to increase tax deductions by awarding such units at artificially low strike prices, achieving the same impact as backdating? Of course tax exempt partners may not care, yet what of the future cash flow impact for public unit holders? In reviewing the history and Blackstone’s limited public disclosure, something just does not look right, in my opinion.
Furthermore, if Blackstone executives exchange unvested NQ options with Blackstone partnership units based upon carried interest, the strike price value difference between each should be fully disclosed to shareholders, not simply in aggregate.
In my original research on stock options back in 1999 I often noted this backdating impact and was simply amazed that at the time there was no concern. It was sad to see how this developed into a legal feed bucket for law firms that never acknowledged the most damaging part of the scheme, that being the creation of a tax deduction pyramid scheme.
In 2000, I arranged a related story on this for Gretchen Morgenson of the NY Times involving two employees at Microsoft who expressed an interest in becoming clients. I tentatively agreed to accept them as clients only if they were willing to discuss their situation with Morgenson given the important tax governance related involving their situation. Similarly, Morgenson agreed that, if she did the story, she would mention my simple idea regarding a pivotal tax reform.
The couple had exercised options but failed to sell shares to pay the tax until they filed their return several months later. The subsequent drop in Microsoft’s stock price left them with a large tax bill and insufficient assets to pay the tax. I had expected that the story, which appeared on the front page, would include my comment that the IRS provide a one-time adjustment in such situations, provided the total options were less than x in value. Unfortunately the comment did not appear yet it was however recognized as a key story with Morgenson being awarded the Pulitzer Prize.
My guess is that the Times advertisers, including Microsoft and Cisco Systems, did not want the story done because if employees were allowed to “look back” on a one time basis, this would clearly eliminate the tax deduction the companies were taking. More centrally, it would challenge the stability of this innovative tax deduction pyramid scheme that began with NQ options and has now morphed into carried interest.
Of course this is particularly germane if a CEO orchestrates the sale of a public company and stays on with the private equity firm as a shareholder. Perhaps Tony James, Blackstone’s president, put it best by saying,“Now we can just exchange the unvested portion of an executive’s NQ options with our partnerships units and not expend valuable cash in order to bring them on board and get the deal done.” You can see this summarized at http://billparish.wordpress.com in two blog posts. One is dated August 2010 and the second March 31, 2011. Both provide important background for this letter.
I spoke with Mark Zehner in your office about this issue last fall, specific to the fractions rule, and frankly must reflect significant disappointment at the lack of follow up, especially given the stellar work he did in the municipal finance area. This is not a UBTI driven issue unique to tax exempt investors in public partnerships but rather an assault on the basic integrity of“the key financial statement” used by advisors like myself to analyze the merits of a particular investment opportunity, the cash flow statement.
We all want the economy to turn around, yet in my opinion, that will only happen when integrity and confidence are restored to the cash flow statement. Doing so will allow numerous peripheral areas to self correct ranging from capital flows to overall tax equity.
Thank you for considering these thoughts and of course I will make myself available for follow up commentary. The opportunity to develop some level of dialogue with the commission would be much appreciated. This could include someone at the commission suggesting I be invited to speak at a major conference, etc.
Sincerely,
Bill Parish
** Blog posts and related audio clips at http://billparish.wordpress.com
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