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Posts Tagged ‘whistleblower appeals’
US Supreme Court Rules FOIA Responses Trigger Bar Against FCA Claims
Thursday, May 19th, 2011
Justice Clarence Thomas Wrote the Schindler Decision
Justice Clarence Thomas wrote the majority opinion holding that Freedom of Information Act request responses constitute “reports,” relators who rely on FOIA request responses can fall prey to the public disclosure bar of the False Claims Act. The Court issued the opinion in Schindler Elevator Corp v. United States ex rel. Kirk on May 16, 2011. Justice Ginsburg filed the dissenting opinion, in which Justices Breyer and Sotomayor joined.
Relator Daniel Kirk, a military veteran, worked for Schindler Elevator from 1978 to 2003. He resigned in September 2003 saying that the company had forced him out. Kirk filed his False Claims action in 2005. In an amended complaint in 2007, Kirk alleged that Schindler has improperly submitted for payment hundreds of false claims to the government because Schindler had certified it was in compliance with VEVRAA reporting requirements. Kirk alleged the certification of compliance was false.
Relator Kirk sought verification that his allegations were correct by asking his wife to ask for Schindler’s reporting information through a FOIA request. Mrs. Kirk made three requests, and DOL responded with information that showed the reports were not filed for several years in question.
Schindler asked the Court to dismiss the case on the ground that the verification information Mrs. Kirk obtained through the FOIA requests was a “public disclosure.” Under the pre-existing public disclosure rules, whistleblower claims could be dismissed if the relator was found to have “based” the allegations on specified types of publically available information. In Schindler, J. Thomas said that a FOIA response = a report = a public disclosure. He left open the question of whether or not Mr. Kirk based his allegations on those FOIA responses.
False Claims actions can be complicated, and the statute requires a whistleblower to be represented by an attorney. For a free consultation on a potential government fraud claim, please call Kenney & McCafferty, P.C. today.
Tags: abuse, clarence thomas, corporate fraud, corruption, False claims, False Claims Act, FCA, FERA, fraud, fraud reward, government fraud, public disclosure, Qui Tam, reward, supreme court whistleblower, tax whistleblower, whistle blower, whistle blowing, whistleblower appeals, whistleblower reward, whistleblowing, wrongful termination
Posted in corporate fraud, False Claims Act, government fraud, Uncategorized, Whistleblower Protection | Comments Off
Tax Whistleblowers Must File within 30 Days of No Answer Letter
Tuesday, April 26th, 2011
In Friedland v Commissioner (T.C. Memo 2011-90), the United States Tax Court dismissed the IRS whistleblower’s appeal because it was not filed within thirty days of the date of the “no answer letter” sent to Friedland by the IRS Whistleblower Office. The Tax Court reiterated its ruling in Cooper – the “no answer letter” constitutes a final determination of a whistleblower claim.
Murray Friedland, a CPA, reported two corporations for tax violations in September 2009. On November 13, 2009, the IRS Whistleblower Office sent Friedland a letter explaining that it had reviewed and evaluated the claim and then said that prevailing law prevented it from explaining why a claim would be denied. Friedland found the letter confusing. He sent additional information about his claim to the Whistleblower Office, and he called for an explanation. The WO responded with three letters, one memorializing a conversation in which Friedland was told that he could write to the US Court of Federal Claims. The letters also confirmed that the WO would not change its determination about Friedland’s claim.
Friedland followed the suggestion of the WO and appealed to the Court of Federal Claims. The Court of Federal Claims dismissed the appeal on May 26, 2010, because the CFC does not have jurisdiction to hear IRS whistleblower appeals. On June 18, 2010, Friedland filed an appeal with the Tax Court.
Friedland filed his appeal 217 days after the date of the first letter, the “no answer letter.” As decided in previous Tax Court rulings, the “no answer letter” is notice of a final determination that the IRS is denying the claim. Whistleblowers have thirty days from the date of the no answer letter to file their appeals. Because Friedland filed 217 days after the date of the no answer letter, the Tax Court ruled that it had no jurisdiction over the claim because it was filed too late.
With regard to Friedland’s obvious confusion about the appeal process, the Tax Court said, “We recognize that petitioner may have relied on the erroneous advice of the Whistleblower Office in filing his initial appeal with the Claims Court. . . We sympathize with the petitioner. We cannot expand our jurisdiction, however, even where the Commissioner provided bad advice.”
Kenney & McCafferty, P.C., has successfully represented IRS whistleblowers, even before the passage of the 2006 whistleblower statute. For knowledgeable and trustworthy representation, contact K&M for a free assessment today.
Tags: Abusive Tax Shelters, Corporate Tax Fraud, Employment Tax Fraud, Estate Tax Fraud, fraud reward, IRS whistle blower, IRS whistleblower, offshore tax fraud, Tax cheat, tax claims, tax court, tax evasion, Tax Fraud, tax petition, tax underpayment, tax whistle blower, tax whistleblower, tax whistleblower petition, whistleblower appeals, whistleblower award, whistleblower reward
Posted in Abusive Tax Shelters, Corporate Tax Fraud, Employment Tax Fraud, Estate Tax Fraud, IRS Whistleblower Office, Money Laundering Tax Fraud, Offshore Accouts Fraud, retaliation, Tax Fraud, Uncategorized, Whistleblower Protection | Comments Off
Don’t File Your Tax Whistleblower Appeal in the Court of Federal Claims
Thursday, February 3rd, 2011
Even though the IRS advised tax whistleblowers up until January 2009 that they could file appeals of claim denials with the Court of Federal Claims, a whistleblower recently found out the hard way that the COFC would not hear the case. Despite sending the whistleblower a Letter 1010 telling him that COFC would hear some whistleblower appeals, the IRS moved that the court dismiss the case. COFC agreed with the IRS.
Claimant Robert Colman notified the IRS that Accountant Steven Krell embezzled funds from and filed false tax returns for Colman’s mother. In 2003, the IRS rejected Colman’s claim and told him he could appeal to the Court of Federal Claims. Colman learned Krell pled guilty to the filing of false tax returns in 2009. Colman filed in the Court of Federal Claims in April 2010 requesting 15 percent of whatever the Service recovered from Krell as a result of the tax action.
The IRS countered by pointing out that Section 7623(a) is not a money mandating statute. Section 7623(a) does not mandate tax whistleblower awards; 7623(b) does. Section 7623(a) covers claims that were made prior to the 2006 statute change that allowed whistleblowers to get awards if their claims met certain criteria. Today, it also includes those claims for awards that fail to meet statutory and agency threshold considerations.
The IRS also stated that COFC could not properly assert jurisdiction over the matter, despite its previous letter to Colman stating that the Court of Federal Claims was the appropriate forum for appeals. The Service stated that in 2003 the Service believed the COFC was the correct court for limited types of whistleblower appeals, but it learned subsequently that this was not true and Letter 1010 confused people with its COFC reference. The Service stopped using Letter 1010 in January 2009. The Court of Federal Claims expressed dismay that Colman wasted time and money by responding in conformity with the letter when he decided to appeal.
Despite its criticism of Letter 1010, the Court of Federal Claims sided with the IRS. Noting that parties cannot confer jurisdiction on a federal court simply by agreeing that a particular court should hear a particular matter, the court dismissed Colman’s case.
Tags: tax claims, Tax Fraud, whistleblower, whistleblower appeals
Posted in Uncategorized | Comments Off
