Category Archives: criminal tax law

The Government Accountability Office (GAO) has released the first in a series of seven annual reports, mandated by the Corporate Transparency Act, evaluating the Financial Crimes Enforcement Network's (FinCEN) safeguarding of beneficial ownership information (BOI) received from certain legal entities. (GAO-25-107403)

The report focused on the extent to which FinCEN granted agencies access to BOI in compliance with the act and FinCEN's oversight of agencies' access to and use of the information. As of October 29, 2024, the following agencies were approved for access to BOI: 

• the FBI, 
• IRS-Criminal Investigations (CI), 
• U.S. Postal Inspection Service, and 
• U.S. Secret Service.

As described in the report, the four agencies were chosen because they were significant and experienced users of BSA data. "IRS-CI investigates complex and significant money laundering activity, including that related to terrorism financing and transnational organized crime," GAO noted.

According to the report, IRS-CI and the other three agencies received initial access to BOI under a pilot program which required the piloted agencies to:

• appoint an agency coordinator (the primary contact for managing BOI access and memorandum of understanding compliance);

• provide FinCEN with a signed memorandum of understanding establishing the terms and conditions under which the agency may obtain, store, use, and re-disclose BOI;

• submit an initial report describing the standards and procedures established to comply with access rule requirements for protecting BOI; and

• provide a certification signed and dated by the agency's head attesting that its standards and procedures comply with the access rule's security and confidentiality requirements.

FinCEN is developing policies and procedures to oversee BOI users, including:

• Annual audits and other inspections.

• Periodic submissions of semi-annual certificates of compliance with established criteria.

• Prompt notification of any compliance failure revealed in annual internal audits and any potential or actual BOI compromise or loss.

• Monitoring of query audit logs.

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According to DoJ, a Florida woman, and dual U.S. and Colombian citizen, pleaded guilty on March 10, 2025 to conspiring to defraud the United States by, among other things, concealing tens of millions of dollars in undeclared foreign financial accounts, filing false tax returns, and evading taxes.

According to court documents and statements made in court, between 2010 and 2022, Gilda Rosenberg, of Golden Beach, Florida, conspired with two family members to conceal from the IRS more than $90 million in assets and income held in undeclared bank accounts in Andorra, Israel, Panama and Switzerland. 

Rosenberg’s family had maintained offshore accounts since the 1970s. By the late 1990s, Rosenberg, who was identified as an owner and an authorized signer on some of the accounts, knew that she and her family members had not disclosed their ownership of these foreign financial accounts to the U.S. government and that they had not paid any taxes on the income earned from the assets in those accounts as was required by law. 

Starting in the early 2000s, the family consolidated their assets at accounts with Credit Suisse in Switzerland and the United Kingdom. Family members told Credit Suisse employees that they were U.S. persons and seeking to hide their assets from U.S. authorities. The assets remained at Credit Suisse until 2013, when Credit Suisse closed the accounts because the family members were U.S. persons. 

When Credit Suisse closed their accounts, the family moved their assets, which were typically titled in the names of nominee entities, to new accounts located at Bank Leumi in Israel, Union Bancaire Privée (UBP) and PKB Privat Bank SA in Switzerland, and an Andorran bank.

Rosenberg Was Documented As The Beneficial Owner Of Accounts At UBP And The Andorran Bank. She Also Signed
False Account Opening Documents That Claimed She Was
A Colombian Resident And Not A U.S. Citizen.

Rosenberg, as well as her relatives, did not file Reports of Foreign Bank and Financial Accounts (FBARS) disclosing their foreign financial accounts, as they were required to do. In addition, Rosenberg and her relatives continued to file false tax returns that omitted income generated by their offshore assets. 

In or about 2017, as part of a scheme to continue to evade their U.S. tax and reporting obligations, Rosenberg and the family members divided the family’s assets and signed documents to make it appear that Rosenberg and a relative gifted the offshore assets to another relative after he had renounced his U.S. citizenship. 

Rosenberg and her relatives then tried to covertly transfer assets to Rosenberg in the United States and to conceal their ongoing and historical tax evasion. To do so, Rosenberg and her relatives, among other things, created fake loan and investment documents to make it appear that transfers to and from Rosenberg were loans and business investments. 

From 2010 Through 2017, Rosenberg Filed False Tax
Returns That Did Not Report More Than $5.5 Million In
Income She Earned From Her Assets At UBP, Which
Caused A Tax Loss To The IRS Of $1,927,342. 

Rosenberg is scheduled to be sentenced on May 30. She faces a maximum penalty of five years in prison as well as a period of supervised release, restitution and monetary penalties. A federal district court judge will determine any sentence after considering the U.S. Sentencing Guidelines and other statutory factors. 

Read more at: Tax Times blog

The Treasury Inspector General for Tax Administration (TIGTA) has published the details of its audit of the Taxpayer Advocate Service's (TAS) Office of Systemic Advocacy. (Audit Report No. 2025-300-006)

The audit was initiated to evaluate the efficiency and effectiveness of the Office of Systemic Advocacy and determine the extent to which the office fulfills its mission, TIGTA said.

As described in the audit, TAS is responsible for the identification and resolution of systemic, procedural, and legislative issues that may affect taxpayers. TAS considers a problem to be systemic if the impact:

• Affects multiple taxpayers.

• Involves IRS systems, policies, or procedures.

• Affects taxpayer rights, increases taxpayer burden, causes disparate treatment of taxpayers, or involves essential taxpayer services.

"To resolve systemic problems that impact taxpayers, the Office of Systemic Advocacy sometimes works with the IRS using cross functional teams," the audit explained, adding that "these collaborative teams may include Office of Systemic Advocacy analysts and IRS employees from various business operating divisions."

A review of 26 collaborative teams that closed during a 21-month period found that only six teams (or 23%) had both a documented objective or mission and a measurable outcome. 

"The Remaining 20 Teams Lacked A Documented
Objective Or Mission, Did Not Have A
Measurable Outcome, Or Both," TIGTA Said.

The Office of Systemic Advocacy does not conduct quality reviews of the collaborative teams, it added.

Further, "TAS has not developed additional performance measures to capture the overall effectiveness of advocacy projects and their impact on tax administration from a previous TIGTA recommendation they agreed to in Fiscal Year 2011," the audit said.

In addition, "issues submitted by taxpayers and other stakeholders into the Systemic Advocacy Management System (SAMS) and resulting information gathering projects were not always reviewed or worked timely," TIGTA said. The audit offered examples in support of this conclusion.

Of the 9,400 systemic and non-systemic issues closed from SAMS in FY 2022, 809 (9 percent) issues were not reviewed timely and took more than 40 days to close. Of the 809 untimely issues, 147 issues took over 90 days.

The IRM states that in general, the recommended treatment for the issue should be developed within 40 business days. Depending on the complexity of the issue, some issues are resolved within a few days, but others may take longer. For example, an issue may take longer if it requires a subject matter expert to help evaluate the issue. 

We selected a judgmental sample of 51 issues (31 systemic issues and 20 non-systemic issues) from the 9,400 issues closed in SAMS in FY 2022 and found that:

• 40 of the 51 sampled issues were not reviewed timely.
• 20 • 20 systemic issues took from 61 to 217 days to resolve. 
• We did not find a reason in the case file for why these issues were untimely. 
• The remaining 11 issues were either reviewed timely or had the reasons for the delays documented in the case file.  
• 20 non-systemic issues took from 92 to 186 days to resolve. We did not find a reason in the case file why these issues were untimely.  
• TAS management agreed that the 40 issues were untimely and responded that some of the causes for not meeting the 40-day requirement included: 
• 20 issues were delayed due to staffing. TAS management stated that in FY 2022, TAS experienced a significant increase in SAMS issue inventory, along with analysts being detailed to the SIRE group, which required the permanent staff to train them (the SIRE group only had three permanent analysts and two detailed analysts).
• Additionally, staffing issues affected their technical teams and IRS function employees who provided input and research on the issues. 
•  20 issues were delayed due to improper management of an employee’s inventory. TAS management said that they developed inventory management tools, including inventory 

"Finally, the Office of Systemic Advocacy does not analyze the SAMS submissions to determine if trends in systemic issues exist or monitor or track systemic issues that are closed prior to resolution," the audit said.

TIGTA made 11 recommendations and, according to the audit, TAS agreed with all of the recommendation and "plans to take corrective actions."

 Have an IRS Tax Problem?

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The Trump administration is drafting plans to significantly reduce the Internal Revenue Service workforce by as much as 50% through a combination of layoffs, natural attrition, and incentivized buyouts.

This dramatic downsizing effort, part of a broader initiative to shrink the federal government, would transform an agency that currently employs approximately 90,000 workers nationwide. The administration hopes to achieve the reductions by the end of the year, the source said.

These steep cuts are expected to end its growing progress to improve customer service, modernize, and catch taxpayers not paying what they owe. 

Without the beefed-up workforce thanks to the tens of billions of extra funding from the 2022 tax-and-climate law known as the Inflation Reduction Act, audits will likely take longer and phone wait times will go back up.

“These Layoffs Would Add Hundreds Of Billions or More
To Deficits And Encourage Tax Cheating, Tilting The Tax
System Further Toward The Wealthy and Business
Interests at The Expense of Everyday Americans” 
Lily Batchelder, former assistant treasury secretary for tax policy and
professor at NYU Law, said in a statement.

A reduction in force of tens of thousands of employees would render the IRS “dysfunctional,”
said John Koskinen, a former IRS commissioner.

The IRS employs roughly 90,000 workers and people of color make up 56% of the IRS workforce, with women representing 65%.

The reduction goal includes:

• IRS employees who have already left or were fired, which is about 12,000 employees. 
• Between 4% and 5% of the IRS’s workforce took the offer from Trump adviser Elon Musk to resign and be paid until Sept. 30, the leader of the agency’s union said earlier Tuesday. and
• About 7,400 probationary employees at the agency have been fired.

More than half of the IRS workforce is eligible to retire within six years, according to National Taxpayer Advocate Erin Collins in a report earlier this year. Actually, the most recent strategic operating plan, states that 63% of the current IRS workforce is eligible to retire within six years.

 Have an IRS Tax Problem?

     Contact the Tax Lawyers at

Marini & Associates, P.A. 

for a FREE Tax HELP Contact us at:
www.TaxAid.com or www.OVDPLaw.com
or Toll Free at 888 8TAXAID (888-882-9243)

Sources

The New York Times

The Associated Press

Bloomberg Law

Read more at: Tax Times blog