KPMG tax shelter convictions upheld in the US

Federal judges in the United States have upheld the convictions of two former
KPMG accountants and a lawyer on tax shelter issues.

However, judges threw out a $6m (£3.9m) fine against one of the defendants.

In December 2008, a New York jury convicted former US KPMG tax partner Robert
Pfaff and former US KPMG senior tax manager John Larson on 12 counts each of tax

Prosecutors said the men represented a tax shelter known as BLIPS as a way
for clients who earned more than $20m (£13m) to eliminate capital gains or
regular income for tax purposes.

The jury also found law firm Sidley Austin LLP partner Raymond Ruble on ten
counts of tax evasion.

Larson was sentenced to ten years in prison and fined $6m (£3.9m). Pfaff
received an eight-year sentence and was fined $3m (£1.9m), while Ruble was
handed a six-year prison term.

But the appeals court ruled Larson’s fine was too high, citing a lack of jury
findings to support a fine above $3m,

Further reading:

date set for Italy’s most serious tax fraud case

Related reading