Internal Revenue Bulletin: 2011-12
March 21, 2011
Announcement of Disciplinary Sanctions From the Office of Professional Responsibility
The Office of Professional Responsibility (OPR) announces recent disciplinary sanctions involving attorneys, certified public accountants, enrolled agents, enrolled actuaries, enrolled retirement plan agents, and appraisers. These individuals are subject to the regulations governing practice before the Internal Revenue Service (IRS), which are set out in Title 31, Code of Federal Regulations, Part 10, and which are published in pamphlet form as Treasury Department Circular No. 230. The regulations prescribe the duties and restrictions relating to such practice and prescribe the disciplinary sanctions for violating the regulations.
The disciplinary sanctions to be imposed for violation of the regulations are:
Disbarred from practice before the IRS—An individual who is disbarred is not eligible to represent taxpayers before the IRS.
Suspended from practice before the IRS—An individual who is suspended is not eligible to represent taxpayers before the IRS during the term of the suspension.
Censured in practice before the IRS—Censure is a public reprimand. Unlike disbarment or suspension, censure does not affect an individual’s eligibility to represent taxpayers before the IRS, but OPR may subject the individual’s future representations to conditions designed to promote high standards of conduct.
Monetary penalty—A monetary penalty may be imposed on an individual who engages in conduct subject to sanction or on an employer, firm, or entity if the individual was acting on its behalf and if it knew, or reasonably should have known, of the individual’s conduct.
Disqualification of appraiser—An appraiser who is disqualified is barred from presenting evidence or testimony in any administrative proceeding before the Department of the Treasury or the IRS.
Under the regulations, attorneys, certified public accountants, enrolled agents, enrolled actuaries, and enrolled retirement plan agents may not assist, or accept assistance from, individuals who are suspended or disbarred with respect to matters constituting practice (i.e., representation) before the IRS, and they may not aid or abet suspended or disbarred individuals to practice before the IRS.
Disciplinary sanctions are described in these terms:
Disbarred by decision after hearing, Suspended by decision after hearing, Censured by decision after hearing, Monetary penalty imposed after hearing, and Disqualified after hearing—An administrative law judge (ALJ) conducted an evidentiary hearing upon OPR’s complaint alleging violation of the regulations and issued a decision imposing one of these sanctions. After 30 days from the issuance of the decision, in the absence of an appeal, the ALJ’s decision became the final agency decision.
Disbarred by default decision, Suspended by default decision, Censured by default decision, Monetary penalty imposed by default decision, and Disqualified by default decision—An ALJ, after finding that no answer to OPR’s complaint had been filed, granted OPR’s motion for a default judgment and issued a decision imposing one of these sanctions.
Disbarment by decision on appeal, Suspended by decision on appeal, Censured by decision on appeal, Monetary penalty imposed by decision on appeal, and Disqualified by decision on appeal—The decision of the ALJ was appealed to the agency appeal authority, acting as the delegate of the Secretary of the Treasury, and the appeal authority issued a decision imposing one of these sanctions.
Disbarred by consent, Suspended by consent, Censured by consent, Monetary penalty imposed by consent, and Disqualified by consent—In lieu of a disciplinary proceeding being instituted or continued, an individual offered a consent to one of these sanctions and OPR accepted the offer. Typically, an offer of consent will provide for: suspension for an indefinite term; conditions that the individual must observe during the suspension; and the individual’s opportunity, after a stated number of months, to file with OPR a petition for reinstatement affirming compliance with the terms of the consent and affirming current eligibility to practice (i.e., an active professional license or active enrollment status). An enrolled agent or an enrolled retirement plan agent may also offer to resign in order to avoid a disciplinary proceeding.
Suspended by decision in expedited proceeding, Suspended by default decision in expedited proceeding, Suspended by consent in expedited proceeding—OPR instituted an expedited proceeding for suspension (based on certain limited grounds, including loss of a professional license and criminal convictions).
OPR has authority to disclose the grounds for disciplinary sanctions in these situations: (1) an ALJ or the Secretary’s delegate on appeal has issued a decision on or after September 26, 2007, which was the effective date of amendments to the regulations that permit making such decisions publicly available; (2) the individual has settled a disciplinary case by signing OPR’s “consent to sanction” form, which requires consenting individuals to admit to one or more violations of the regulations and to consent to the disclosure of the individual’s own return information related to the admitted violations (for example, failure to file Federal income tax returns); or (3) OPR has issued a decision in an expedited proceeding for suspension.
Announcements of disciplinary sanctions appear in the Internal Revenue Bulletin at the earliest practicable date. The sanctions announced below are alphabetized first by the names of states and second by the last names of individuals. Unless otherwise indicated, section numbers (e.g., § 10.51) refer to the regulations.
|City and State||Name||Professional Designation||Disciplinary Sanction||Effective Date(s)|
|Citrus Heights||Benoit, George L.||Enrolled Agent||Disbarred by consent for violation of § 10.51 (failure to timely file Federal individual income tax returns for tax years 2002–2004 and failure to file Federal individual income tax return for tax years 2005–2009).||Indefinite from December 7, 2010|
|Newport Beach||Prendiville, Andrew J.||Attorney||Suspended by default decision in expedited proceeding under § 10.82 (attorney disbarment)||Indefinite from January 7, 2011|
|San Diego||Withers, Roy R.||Attorney||Suspended by default decision in expedited proceeding under § 10.82 (attorney disbarment)||Indefinite from January 7, 2011|
|Monterey Park||Wong, Richard Po-Chung||CPA||Suspended by default decision in expedited proceeding under § 10.82 (conviction under 18 U.S.C. § 1343, wire fraud, aiding and abetting, 26 U.S.C. § 7201, tax evasion, and 26 U.S.C. § 7206, willful aiding and assisting preparation of false tax return and license revocation)||Indefinite from December 13, 2010|
|Aurora||Krech, Robert G.||CPA||Suspension by consent for violation of § 10.22, (practitioner did not follow due diligence in the determination of the validity of credits and deductions under Section 44 of the Internal Revenue Code).||Indefinite from December 31, 2010|
|Honolulu||Paco, Nathan||Attorney||Suspended by default decision in expedited proceeding under § 10.82 (attorney disbarment in California)||Indefinite from January 7, 2011|
|Avon||Andrews, Ted E.||CPA||Reinstated to practice before the IRS, effective December 20, 2010|
|Overland Park||Davison, Allen R.||CPA (Kansas)/ Attorney (Nebraska)||Suspended by decision in expedited proceeding under § 10.82 (permanently enjoined by U.S. District Court from organizing, establishing, promoting, selling, offering for sale or helping to organize, establish, promote, sell or offer for sale any tax plan, involving sham parallel C management companies, sham 412(i) plans, sham flock contracts or any other illegal tax scheme, plan or device; shall not organize, establish, promote, sell, offer for sale or assist in any financial or tax related arrangement without submitting in writing to an IRS designee, a detailed plan explaining the financial or tax arrangement and all steps necessary for the arrangement to be legal under the tax code.||Indefinite from December 17, 2010|
|Monroe||Bradley, Louis R.||CPA||Suspended by decision in expedited proceeding under § 10.82 (suspension of CPA certificate)||Indefinite from January 18, 2011|
|Lansing||Horton, Darryl S.||CPA||Suspended by default decision in expedited proceeding under § 10.82 (conviction under 26 U.S.C. § 7206, aiding and assisting in the preparation and presentation of a false and fraudulent income tax return)||Indefinite from January 7, 2011|
|Davidson, Allen R. See Kansas|
|Annandale||Orlando, Charles J.||CPA||Suspended by consent for violation of § 10.51 (failure to file Federal individual income tax returns for tax years 2007 and 2008, failure to timely file Federal individual income tax returns for tax years 1998–2006, failure to file employer’s quarterly Federal tax return for five quarters, failure to timely file employer’s quarterly Federal tax returns for most quarters 2001–2008, failure to pay Federal individual income tax 1998–1999 and 2002–2006, failure to pay taxes due on employer’s quarterly Federal tax returns for most quarters 2001–2007 and 2008–2009, and failure to timely pay taxes due on employer’s quarterly Federal tax return for one quarter in 2008.||Indefinite from December 17, 2010|
|Newton||Wentz, Deborah||CPA||Reinstated to practice before the IRS, effective November 1, 2010|
|McAllen||Burford, Kenneth F.||Attorney||Suspended by consent for violation of § 10.51, (failure to timely file Federal individual income tax returns for 2006–2007, failure to pay Federal individual income tax for 2007–2008, failure to timely file employer’s quarterly Federal tax returns for eight quarters 2004–2009, and failure to pay Federal tax liabilities for Kenneth Burford, CPA, JD)||Indefinite from December 21, 2010|
|Odessa||Hargus, Richard L.||Enrolled Agent||Reinstated to practice before the IRS, effective October 22, 2010|
|Bedford||Morse, Kyle K.||CPA||Reinstated to practice before the IRS, effective December 22, 2010|
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