Accounting Fraud Targeted [WSJ]
[A]s the volume of crisis-related cases ebbs, top SEC officials are expected to announce soon a broad shuffling of resources in the agency's enforcement division that will include an increased focus on accounting fraud, according to people close to the agency. [...] The move is led by SEC Chairman Mary Jo White and co-enforcement chiefs George Canellos and Andrew Ceresney, said the people close to the agency. It isn't clear how much money or manpower will be devoted to the effort, though the SEC already is developing a computer program to sift language in financial reports for clues that executives might be misstating results, agency officials say. Mr. Ceresney, a former federal prosecutor who joined the SEC in April, and Mr. Canellos have told employees there are no plans to get rid of five specialized enforcement units started in 2009 that are devoted to market abuse, asset management, foreign corrupt practices, municipal securities and structured products. People close to the SEC expect changes to some of the units, though, which they say could give the agency more leeway to make accounting fraud a top priority. "We have to be more proactive in looking for it," Scott Friestad, a senior SEC enforcement official, told a legal conference last month. "There's a feeling internally that the issue hasn't gone away."
Groups Targeted by I.R.S. Tested Rules on Politics [NYT]
When CVFC, a conservative veterans’ group in California, applied for tax-exempt status with the Internal Revenue Service, its biggest expenditure that year was several thousand dollars in radio ads backing a Republican candidate for Congress. The Wetumpka Tea Party, from Alabama, sponsored training for a get-out-the-vote initiative dedicated to the “defeat of President Barack Obama” while the I.R.S. was weighing its application. And the head of the Ohio Liberty Coalition, whose application languished with the I.R.S. for more than two years, sent out e-mails to members about Mitt Romney campaign events and organized members to distribute Mr. Romney’s presidential campaign literature. Representatives of these organizations have cried foul in recent weeks about their treatment by the I.R.S., saying they were among dozens of conservative groups unfairly targeted by the agency, harassed with inappropriate questionnaires and put off for months or years as the agency delayed decisions on their applications. But a close examination of these groups and others reveals an array of election activities that tax experts and former I.R.S. officials said would provide a legitimate basis for flagging them for closer review.
Getting to Tax Reform [Economix/NYT]
In recent weeks, the odds favoring tax reform in the not-too-distant future have improved somewhat. The improving deficit means that tax reform need not raise net revenues, as President Obama has demanded; the controversy about aggressive tax avoidance by Apple and other multinational companies has focused Congress’s attention on a key goal of tax reform, which is fixing the multinational tax regime; and the furor over the Internal Revenue Service and accusations that it targeted conservative groups almost certainly means there will be bipartisan legislation to make sure this doesn’t happen again, thus providing a legislative vehicle for tax reform. What is missing, unfortunately, is the outline of an actual tax reform bill. Some progress, however, has been made.
Who Will Crack the Code? [NYT]
Soda companies engage in tax avoidance schemes, too!
Internet Sensation Charles Ramsey Gets Free Food From McDonald's: Do You Want Taxes To Go With That? [Forbes]
"I don’t have a fuckin’ clue, bro. I’m just standing here with my McDonald’s.”
Eleventh Circuit: Father Of The Year Candidate Recognized $36 Million In Taxable Income Upon Exercise of Options [Forbes]
Tony Nitti: "This act of poetic justice should remind all parents that if you’re going to be overbearing and meddle in your kids’ lives, try and confine your fatherly misgivings to hurling empty whiskey bottles at Little League umpires, like my old man. Interfering with their careers can prove expensive."
Because this is about morals, you know.
Deloitte appoints official criticised over 'sweetheart' tax deals [Guardian]
Dave Hartnett has been hired by accountancy firm which faced tax avoidance allegations during his time as head of HMRC. The row over tax avoidance by multinational companies escalated on Monday night as it emerged that Dave Hartnett, until 10 months ago the country's leading tax official, has been appointed to a new position with a leading accountancy firm mired in the controversy. Hartnett will work one day a week with Deloitte, the auditors for Vodafone and Starbucks, which faced tax avoidance allegations during his time as head of HM Revenue & Customs. The appointment was approved by David Cameron and the advisory committee on business appointments last week, although Deloitte did not announce the high-profile signing.
Understatement of the year.
Hope everyone had a fun and safe weekend.