We all know who is at fault here

Car Dealers Indicted for Tax Fraud; Profession’s Shifty Reputation Remains Intact

Plus, one of the (alleged!) tax fraudsters is facing seven counts of manslaughter. Impressive.

James Pflueger, a landowner facing seven counts of manslaughter on Kauai for the deaths of seven people killed when the Kaloko dam broke in 2006, was indicted Wednesday by a federal grand jury for tax fraud.

Altogether, five defendants were charged with conspiracy to defraud the U.S. for the purpose of obstructing the Internal Revenue Service in its collection of taxes.


They include Pflueger’s son, Charles Alan Pflueger, who owns car dealership Pflueger Inc.; company chief financial officer Randall Ken Kurata; Charles Alan Pflueger’s executive assistant, Julie Ann Kam; and certified public accountant Dennis Lawrence Duban.

James Pflueger, 83, is the former owner of the company.

The Plfuegers are proven business people but they simply can’t be expected to have the first damn clue about these tax matters:

Dave Scheper, an attorney representing Charles Alan Pflueger, issued a statement denying any wrongdoing by his client and also vowed a vigorous defense.

“He is a proven businessperson who always acts in good faith, but he is not and has never pretended to be a tax accountant,” Scheper said.

So naturally, the blame is going straight to the CPA in this case, Dennis Duban, but not because he screwed over Pflueger & son and their sterling reputations but because he just plain sucks at preparing tax returns.

An attorney for Duban said he looks forward to arguing the case in court. “We are confident that after a jury hears all of the evidence, Dennis will be completely exonerated,” said attorney Michael Purpura.

This is one of those cases where it will take about five minutes of poking the accountant with a stick and he’ll flip.

Retired Car Dealer Indicted by Federal Grand Jury [WJTV]

Jeremy Newman Has Had It

jnewman.jpgSo much so that he wrote a letter. The BDO International Global Coordiation CEO and infrequent blogger sent his letter to the Financial Times today in response to previous letters to the FT that unequivocally placed the blame for the financial apocalypse on accounting rules.
Newman, who strikes as the mild-mannered sort, comes as close to telling all the haters out there, “OH, HELL NO” as one might expect:

Sir, It is unfortunate if people are persuaded that accounting rules are to blame for bad lending decisions and poor investments (Letters, December 29). Banks, and other financial institutions, needed injections of monies from governments (and others) because they lost money and were short of cash – not merely because of accounting issues. Inadequate bad debt provisions, if such was the case, may have resulted in unduly large bonuses being paid but it was not the bonuses that created the cash shortages – it was the poor lending decisions that resulted in such bad debts. Equally, accounting rules did not result in companies overpaying for acquisitions – it was the poor investment decisions that resulted in a decision to overpay.

It’s pretty clear that J. New is sick and tired of everything being blamed on accounting rules and he figured writing a stern (but cordial) letter to the FT was the best way to draw the line in the sand. While that might have some effect, we would invite him to cut loose (read: go completely ape shit) on his blog to tell those IFRS haters what they can do with their pointer fingers. If you want us to read a draft JN, we’re here for you buddy.
Poor business decisions were behind losses [FT]