Criminal Tax Defense is a complex area of law. If you are researching the different types of attorneys in this area of law, they typically include:
- Criminal Tax Attorney
- Tax Evasion Attorney
- Criminal Tax Lawyer
- Tax Fraud Attorney
Golding & Golding
We represent individuals in criminal tax investigations involving Offshore/Foreign Disclosure.
A criminal tax investigation can be a very scary ordeal, because unlike an IRS Civil Audit (unless it turns criminal) which will resolve itself by either penalties being issued or a no change letter – with Criminal Tax, your freedom is at stake.
An IRS Special Agent Contacted Me?
I cannot state this any more clearly to anyone who receives a communication or personal introduction from an IRS Special Agent. Do NOT speak with them. They are not your friends, they are not here to make sure you are safe, and they are not here “just for her information.”
Trust me, special agents do not travel door-to-door to check up on the welfare of individuals to make sure everything is okay in life. Rather, the Special Agents are there to try to extract information from you. They are extremely well-trained and will read your body language and responses to their initial questions and/or presence, quickly “size you up” and determine the best strategy to try to obtain information from you.
You are never required to speak to the IRS Special Agent outside the presence of your attorney. Always remember, the Special Agents are investigating situations in which they believe there is a criminal aspect.
Never in the history of the world will the IRS drop a criminal investigation because you convinced them during an initial introduction that there is no need for them to communicate with you and it always benefits you to “Lawyer Up.” (see Tom Segura’s comedy segment on 48 hours for a good laugh about it)
Here are a few things to keep in mind if you are ever contacted by the IRS Special Agent:
My Bank Told Me a Special Agent Left his or her Card
If the Special Agent left his or her information at the bank and is researching your account, then you need to run – not walk – and find an experienced International Tax/Litigation Attorney. The IRS does this with the hope that the bank does contact you, so the IRS can see how you react (Who do you call, Do you go to see an attorney, etc.)
As with everything they do, the reason the IRS agent contacted the bank is because the IRS agent wants to obtain information regarding your accounts. Since we practice in the realm of International Tax and Offshore Tax Fraud law, from our experience it is probably because you have international funds being transferred in and out of the United States and the IRS once to learn more — or a related issue.
Maybe you did not file the proper FBAR Forms, or maybe you’re out of FATCA Compliance. Moreover, more likely than not your offshore financial representative or institution may have gotten themselves or itself into trouble with the law. As such, the IRS is investigating all of the clients associated with this particular financial advisor or institution and your name popped up.
*Go With Your Instinct.
I Think I am Being Tailed
If the Internal Revenue Service believes you have committed a serious financial crime, you may become the subject of an investigation. Generally, before you are approached by a Special Agent, the agency will have compiled at least some evidence against you. It is not above the IRS special agents to tail you, without your knowledge – to get a better idea of what the facts and circumstances are.
In fact, if you believe your being tailed then you should contact an attorney immediately. Recently, we had a client contact us who had considered entering OVDP, but was hesitant. After leaving office they returned home to find 10 unmarked vehicles and upwards of 20 officers on the search warrant for their luxury home in Los Angeles.
I May be a Little Bit Guilty
It is important that if you are ever confronted by Special Agent, that you do not engage in conversation with that special agent. We had a client who came days after speaking with the Special Agent, in which the special agent assured the individual that the investigation was only against financial institution, and not him personally.
They interviewed him “informally,” and must have taken note of the fact that he was very scared. Why? Because even though they questioned him in a “soft” non-threatening matter, two days later, the agent returned with other agents and issued a search warrant, retrieving multiple computers from the home.
I was only “kind of Involved” in the Fraud
As the old saying goes, you can’t get a little bit pregnant. The same concept holds true for guilt. You may not been the leading cause of the fraud, you may not receive the most money from the fraud, and you may not have initiated the fraud — but if you are involved in the fraud, then from the IRS perspective you are guilty. Moreover, if the IRS special agents believe you are the weak link, you may become subject to intense investigation — hoping that the break.
I Did it, but I Have Not Been Charged Yet
This is a situation, which can be resolved. Presuming that the foreign bank has not reported you to the IRS, and an investigation has not been initiated against, this is the time to do it.
The Offshore Voluntary Disclosure Program is designed to assist individuals with unreported foreign and domestic money before they are contacted by the IRS. If the money is illegally sourced, there maybe some additional hurdles and hoops to jump through – but almost always you will be in a much better positioned than if you are caught by the special agents before proactively making a disclosure.
A Special Agent Came to My Home
As if it’s not scary enough for your trusted bank employee to let you know an IRS agent came by the bank, imagine your reaction when you open the door to find two individuals, in suits holding a “badge” and wanting to speak with you. Once you pick your stomach up off the ground and try to gather your thoughts (while trying to stay calm as you read the words “ IRS Special Agent” from the card handed to you from the agent), the only words that should come out of your mouth are “ I’ll have my attorney contact you.”
There is no need to be rude or abrasive toward the special agent – that will get you nowhere fast. Rather, by letting the agent know you have an attorney, he or she will not expect any further response. They may try to goad you on to elicit a response, but you should not fall victim.
Unless the special agent has an arrest warrant, typically they cannot simply arrest you on the spot, or force you to answer questions. If they have a search warrant, they will want to enter the home immediately, so you should contact an attorney immediately to review the parameters of the warrant.
** If the special agents “knock and announce” that they have a search warrant, ask them to slip a copy of it under the door before opening the door. Technically, you are entitled to have a copy of the warrant and you are not required to open the door to strangers — but if they have a warrant, they make their way in irrespective of whether you cooperate or not.
The Special Agent Told me Not To Worry
Special agents will use this technique when they know you are scared. They would try to relax you enough to obtain information from you, which we used against you later in the process. If a special agent tells you not to worry, he or she just has a few questions for you, your response should be “ I’ll have my attorney contact you.”
We understand that in general individuals like to adhere to rules and answer questions to try to explain the situation.
And, when a person of authority comes to your door and wants to speak to you, your immediate reaction will be to want to speak to them to either diffuse the situation or be respectful. We understand this, but is important that you realize that if a Special Agent is knocking at your door, he or she has belief, or reason to believe that you are involved in something that is criminal.
In other words, when was the last time before now that a Special Agent just randomly stopped by your house to ask you some questions?
Thus, while it may feel slightly awkward — your best bet is to not answer any questions at that time and only do so in the presence of your attorney.
You are issued a Summons
If the IRS agent issues you a summons (or you are otherwise issued a summons by the IRS) you cannot ignore. Why? Because if you ignore the summons, the matter will escalate. A summons is a legal document which is enforceable by the court, and your failure to respond to a summons may lead to a court order finding you in contempt and thereafter an arrest warrant being issued for your arrest.
We understand it is scary and overwhelming, but the best way to resolve your issue when you’re contacted for a potentially criminal investigation by the IRS is to retain experienced international tax/litigation counsel to represent you throughout the process. There are more effective methods than burying your head in the sand hoping it will go away – because normally it will not go away and the longer you stall, the worse it becomes.
The IRS is working at a much reduced capacity and will not have the ability to go after each person individually that it believes may be involved. No matter how far removed you are from the main fraud – with international tax evasion related issues – it is important to try to take care of the matter sooner as opposed to later (and to put the fire out when it is smaller, before it becomes a raging inferno which may result in the loss of your freedom).
You are Issued a Subpoena
If you are issued a subpoena, contact an attorney. You could attempt could quash the subpoena or take other legal action, but burying your head in sand is not one of them. Why? Because the subpoena is a legal document requiring you to comply and if you fail to comply, a Judge may issue a bench warrant to have you arrested on the spot.
Moreover, if your initial reactions (as it would be for most people) is to run, please keep in mind that depending on how much money you owe the IRS may have already revoked her passport and/or issue customs hold at the airport. Trust me, you do not want to be at the airport alone, outside of counsel — and placed into a small room and questioned on the spot.
Be Proactive – Consider Entering OVDP
For most individuals, if they have not been contacted yet by the Internal Revenue Service or other government agency, the best option will be entering the traditional Offshore Voluntary Disclosure Program.
When Do I Need to Use Voluntary Disclosure?
Voluntary Disclosure is for individuals, estates, and businesses who are out of compliance with the IRS and the Department of Treasury. What does that mean? It means that if you are required to file a U.S. tax return and you don’t do so timely, then you are out of compliance.
If the IRS discovers that you are out of compliance, you may become subject to extensive fines and penalties – ranging from a warning letter all the way up to tax liens, tax levies, seizures, and criminal investigations. To combat this, you can take the proactive approach and submit to Voluntary Disclosure.
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