Individual Indictments
In 2003, whistleblower Michael Hamersley testified before the U.S. Senate Finance Committee and assisted the investigations of U.S. Senate Homeland Security Governmental Affairs Committee's Permanent Subcommittee on Investigations. The subcommittee's report (S. Rept. 109-54) detailed the misconduct.
On 29 August 2005, nine individuals, including six former KPMG partners and the former deputy chairman of the firm, were criminally indicted in relation to the multi-billion dollar criminal tax fraud conspiracy. The nine individuals named in the indictment were:
- Jeffrey Stein, former Deputy Chairman of KPMG, former Vice Chairman of Tax Services, and former KPMG tax partner, a lawyer with a Master’s in tax law.
- John Lanning, former Vice Chairman of Tax Services, and former KPMG tax partner, a CPA (Certified Public Accountant).
- Richard Smith, former Vice Chairman of KPMG in charge of Tax, a former leader of KPMG’s Washington National Tax, and former KPMG tax partner, a lawyer.
- Philip Wiesner, former Partner-In-Charge of KPMG’s Washington National Tax and former KPMG tax partner, a lawyer with a Master’s in tax law and a CPA.
- John Larson, a lawyer, CPA and former KPMG Senior Tax Manager who left KPMG to form a series of entities with defendant Robert Pfaff, which entities participated in certain tax shelter transactions as the purported investment advisor.
- Robert Pfaff, a lawyer, CPA and former KPMG tax partner, who left KPMG to form a series of entities with defendant John Larson.
- Raymond J. Ruble, also known as R.J. Ruble, a lawyer and former tax partner in the New York, New York, office of Sidley Austin, a prominent national law firm.
- Mark Watson, former Partner-in-Charge of the Personal Financial Planning division in KPMG’S Washington National Tax, and former KPMG tax partner, a CPA.
On 17 October 2005, another ten individuals were indicted on criminal conspiracy and tax evasion charges:
The four tax shelters at issue were known as BLIPS, or bond linked issue premium structure; Flips, or foreign leveraged investment program; OPIS, or offshore portfolio investment strategy and a variant of Flips; and SOS, or short option strategies.
Read more about this topic: KPMG Tax Shelter Fraud
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