The Internal Revenue Service (IRS) had a number of successful enforcement actions in 2021. The IRS Whistleblower Program is currently undergoing understaffing and is experiencing long delays in processing whistleblower claims and in paying out rewards for successful enforcement actions. Legislators are looking to improve the program to mitigate these issues. Nevertheless, in 2021, the IRS brought some notable, successful enforcement actions.
Below are 3 noteworthy IRS enforcement actions from 2021:
- Renaissance Technologies, LLC.
Due to an “error,” Renaissance failed to account for the short-term financial benefits when trading what they considered long-term gains. After a decade of discussing this with the IRS, it’s been reported that they finally reached a settlement where they admit that the taxes in question should have been taxed as short-term gains, resulting in a payment of $7 billion to the IRS
- Thomas E. Sandell
Sandell, owner of Sandell Asset Management Corporation, shifted around and hid investment fees from New York to Florida and London using a shell company they controlled. When the whistleblower, one of the company’s accountants, noticed the fraud taking place, the whistleblower notified Sandell that they owed New York over $100 million in taxes. The whistleblower was immediately fired in what amounted to clear retaliation from Sandell. Fortunately, the accountant blew the whistle and received a $22 million award for their efforts in stopping the illegal tax evasion.
- Swiss Life Holding AG
The insurance company entered a deferred prosecution agreement where they will pay $77 million dollars for conspiring with US taxpayers to hide around $1.5 billion in assets and income using offshore insurance policy investment accounts that were basically were abusive tax shelters.
Do you have a valid claim?
If you witnessed any widespread suspicious activity within your workplace, you might have a chance of becoming a whistleblower by reporting an ongoing fraudulent scheme. However, to increase your chances of success, you must be sure to back up your claim with substantial evidence or privileged information.
A Quick Whistleblower Checklist
Is the fraudulent scheme widespread enough?
Has the fraud been perpetuated for years or involves large sums of money?
Do you possess any physical evidence of the fraud (documents, forged signatures)?
Do you have access to privileged information which may help our investigators?
Do you work as an insider within the company perpetrating the fraud?
Did you witness any ongoing illegal behavior within your workplace?
Have you been forced into taking part in any suspicious corporate activity?
