Here's one those fraud cases I just can't get my head around. Sean Weaver, 33, a former principal with Ryan, LLC pleaded guilty today to a $20 million tax scheme. He ran the whole thing by himself out of the firm's transaction tax practice group. The FBI press release states that he was in charge of, "10 to 15 employees and was responsible for submitting claims to the state taxing authorities on behalf of Ryan LLC’s clients."
Here's the scam — Weaver fudged client data and threw together phony invoices to boost the amount of sales/use tax paid by two Ryan clients. The Virginia Department of Taxation and Texas Comptroller of Public Accounts then refunded $20 million to those clients. Ryan's fee was a percentage of those refunds and the firm paid Weaver a percentage of that fee as a bonus. He collected over $350k as a result of it.
Here are few interesting things: 1) Weaver started the scam in October 2011, meaning he was 29-ish years old; 2) Ryan promoted Weaver to principal just last December; 3) The scam ended last December. Ryan almost certainly promoted Weaver because of the revenue the firm earned from the scam!
But that's what I don't get. Weaver probably didn't have to juke those numbers to make a nice living and end up earning a promotion. I mean, what's a firm like Ryan charge for services like these? Ten percent of the refund? Five percent? And on top of that, what's Weaver's bonus? One percent? Two? Why not play it straight and clean up? There's no shortage of businesses out there that couldn't use some help getting sales tax refunds.
Seriously, what was this guy's motivation? He's young, obviously good enough at what he does to run a team of 10 or more, given a plum bonus structure; it doesn't make sense. Like, was it not a good enough arrangement?
Instead, he commits fraud, ruins his career and will probably do time. This makes Scott London's career choices look positively brilliant by comparison.
