Aiding and Abetting

Does the IRS Say that You Were Aiding and Abetting a Tax Crime?

At the law firm of Brown, PC, our clients come to us from throughout the world. Our clientele includes highly educated, extremely wealthy and quite sophisticated individuals as well as businesses. Many clients are referred to our firm by their trusted advisors (CPAs, investment advisors and lawyers, for example). Sometimes these very individuals are themselves implicated in criminal investigations or charges related to financial activities of business people.

Are you a bookkeeper who may be accused of aiding and abetting in tax crimes for an accounting client who is under investigation for crimes such as the following?

Anyone who is found guilty of carrying out, committing or aiding any tax crime has a great deal to lose. A CPA who is asked to keep two sets of books for a business owner or professional — one legitimate and the other intended for tax reporting purposes — is at risk. Being accused, investigated, charged or convicted can be devastating to anyone’s financial management career.

Straighten the matter out before it reaches the point of criminal charges if possible. Or if you have already reached that point, meet the challenge head-on with a former Department of Justice Tax Division Trial Attorney on your side. Brown, PC handles tax controversies and tax litigation of all types on behalf of individuals, businesses and professional advisors — including accountants charged with aiding and abetting tax fraud.

Defending Clients Accused of Aiding and Abetting a Tax Offense

A person or entity that participates in furthering the success of a tax offense may be held criminally liable for aiding and abetting. Banks, accounting firms, business executives and tax and legal professionals can become embroiled in a tax violation charge even though they did not commit the underlying crime. To aid and abet a tax crime carries steep penalties, including extensive fines and incarceration. In some cases, the principal of the crime may get off scot-free while the person accused of aiding and abetting serves time and pays expensive fines.

Brown, PC is a 25-year-old boutique law firm that focuses exclusively on tax litigation and white-collar crime defenses. Our founding attorney Lawrence Brown is a former Department of Justice Tax Division trial lawyer who has inside knowledge into the prosecution of aiding and abetting.

The client profile at our firm includes successful businesspeople, attorneys, accountants and executives and some of the best-known companies in the financial and tax worlds. A criminal tax charge can cost them six and seven figures and may irreparably damage their reputations and futures. With so much at stake, we believe that every client deserves the highest quality representation. Our firm, therefore, carefully selects all of our cases to ensure we can give each and every client individualized attention.

Aiding and Abetting a Tax Crime

Aiding and abetting may be attached to any crime in which the government suspects the person helped perpetrate. This includes the full scope of tax crimes, including:

Tax evasion
Failure to pay
Fraudulent W-4
False statement
False or fraudulent document
Removal or concealment with intent to defraud
Fraudulent returns or statements
False, fictitious or fraudulent claims
Tax money laundering

As with any crime investigation, early intervention is crucial. Often, law enforcement officers give the impression that they are investigating the principal, when in fact they suspect the “witness” of aiding and abetting. In other cases, a general inquiry can quickly turn into an aiding and abetting charge. An experienced Fort Worth tax law attorney can protect your rights at this vital phase in the case.

What is Aiding and Assisting?

Aiding and abetting can never be charged alone. The charge must accompany a principal crime that the defendant is accused of helping to perpetrate. The alleged aider and abettor is not accused of performing all acts that constitute the principle crime but instead is charged with being an accomplice to the crime.

18 U.S.C. §2 covers two types of aiding and abetting offenses generally:

The person commits, aids, abets, counsels, commands, induces or procures commission of a crime, which the government must prove beyond a reasonable doubt before the aiding and abetting charge attaches. The aider and abettor becomes a co-principal to a crime that another person completes.
The person willfully causes performance of an act that is a crime. This statute specifically targets persons who use an innocent intermediary to perform a criminal act. Because there was no criminal intent, the intermediary is not guilty of committing the underlying offense. Nonetheless, the government need only prove the aider and abettor was guilty of a substantive crime.

The person accused of aiding and abetting may be found guilty even if the principal is acquitted or not charged. The principal’s lack of intent is also irrelevant to the aiding and abetting charge, as long as the aider and abettor meets all the elements of that offense. In addition, the government may solely charge a person for aiding and abetting even if the principal was necessary to successfully complete the criminal act.

Elements of Aiding and Abetting

To secure a conviction, the government must prove each element of aiding and abetting beyond a reasonable doubt:

The person associated with a criminal venture.
The person knowingly participated in the crime.
The person intended that those actions result in commission of a crime.

The government may rely upon circumstantial evidence to prove criminal intent. Aiding and abetting is often confused with conspiracy, but is much broader in that aiding and abetting requires assistance with performance of the underlying crime. Aiding and abetting is committed at the moment the person consciously shares in the underlying criminal act, regardless of whether a conspiracy is committed.

The Underlying Offense and the Aider and Abettor’s Role

Under §2(b), the government must prove the aider and abettor had the requisite intent and all other elements of the underlying offense, but need not prove the principal is guilty of committing the crime. In fact, the government may decide to prosecute the aider and abettor despite not convicting or even identifying the principal, or if the principal was tried and acquitted for the underlying crime.

Prosecution under §2(b) requires the government to prove the intent of both the principal and the aider and abettor. Interestingly, the government does not need to prove the aider and abettor knew about every detail of the underlying offense.

Just as intent may be proven through circumstantial evidence, so may the aider and abettor’s participation in furtherance of the underlying crime. Therefore, the person’s mere presence may be a factor, although not enough on its own, to prove participation.

Two cases demonstrate how the government uses circumstantial evidence to prove aiding and abetting. In one, the defendant was convicted for running an unlicensed distillery. Prosecutors proved that the defendant was a lookout and then fled the scene when police arrived to establish the element of participation. In another case, the defendant was convicted for knowingly participating in a drug distribution venture. Circumstantial evidence that was characterized as secretive and suspicious included joining other traffickers at a warehouse, traveling in a refrigeration truck to another town with them and being present as they unloaded marijuana from the truck.

For additional in-depth information on Aiding and Abetting, please visit our Criminal Tax Corner – Aiding and Abetting in Violation of 18 U.S.C. Section 2

Contact Lawrence Brown to find the legal counsel you need to protect your reputation, your career and your liberty if you are under investigation for aiding in tax crimes. Centrally located in Dallas-Fort Worth, the Texas law firm serves clients throughout North America and worldwide.

Criminal Tax Matters