Kansas City CPA and Attorney Barred from Promoting Tax Fraud Schemes
A Kansas City, Missouri federal judge permanently barred former CPA and Nebraska attorney, Allen R. Davison, from promoting tax fraud schemes. The court found that from at least the mid-1990s, Davison had promoted tax-fraud schemes that included arrangements involving sham companies and bogus deductions for the purpose of illegal tax avoidance.
The court order describes schemes Davison set up for clients which included medical practitioners, an insurance broker, and car dealership owners. As provided by the court, Davisons schemes were “deliberately complex” in order to “evade IRS detection.” In attempts to evade detection, Davison fabricated records, prepared documents after the fact to address IRS concerns, and intentionally provided false information to the IRS during client audits. Davison also “deliberately disguised the nature of his work” and “expressed a willingness to change to new and different tax fraud schemes when faced with the heightened IRS scrutiny of older schemes.”
The court found that Davison “deliberately advised his clients to break the law, and helped them go about doing so.” The court provided examples of some of Davisons schemes which included sham management companies whose shares were owed by employee stock option plans and Roth IRAs, bogus chicken “ flock deductions claimed for clients who were not eligible to claim them because they failed to qualify as farmers under federal tax law, and sham corporations set up for the sole purpose of sponsoring pension plans for the benefit of Davisons clients who owned businesses.
John A. DiCicco, Acting Assistant Attorney General for the Justice Departments Tax Division stated that the “nations tax system relies on the integrity of tax professionals.”
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