On Tuesday Madoff’s long-time accountant, David G. Friehling, pleaded guilty in the criminal investigation of the 20-year “Ponzi Scheme” that lost investors a total of $21.1 billion in cash.
According to the New York Times, “Mr. Friehling also pleaded guilty to three counts of obstructing the administration of the federal tax laws – charges added within the last five days to the government’s original complaint.”
This recent development shines light that may lead the investigation away from securities fraud and into the realm of criminal tax cases. With Mr. Friehling’s cooperation, it is highly likely that the investigation will strive to build criminal tax cases against other members of the Madoff drama.
Though Friehling has been working closely with Madoff and personally had investments in the scheme, he denies any knowledge of Madoff’s “Ponzi Scheme”–claiming that he “trusted Madoff’s numbers and took the numbers given to him to plug into his independent audits.”
The New York Times reports that “in essence, Friehling admitted that he had never adequately audited the Madoff operation and, as an investor in the scheme, had never been a truly independent auditor. Nevertheless, he produced the supposedly professional and independent audits that sustained the Madoff fraud year in and year out.”
Besides three tax charges, Friehling pleaded guilty to one count each of securities fraud and investment adviser fraud and four counts of making false filings to the Securities and Exchange Commission. He also pleaded guilty to nine criminal charges back in December when the “Ponzi Scheme” collapsed which gives him up to 114 years in prison.
If you or someone you know have been affected by the Madoff scandal, you can claim some tax relief on the investments you lost. Tax Resolution Services helps people to recoup their investment losses through the IRS tax code.
Most victims of these “Ponzi Schemes” can convert their capital stock losses into “ordinary” losses and offset them against prior, current and future ordinary taxable income, thereby reducing the taxes paid in those years, and receiving a refund with interest. Learn more about how you can recover your investment losses.
Don’t let the “Ponzi Scheme” ruin your life. Reclaim a portion of your losses with professional tax help. Contact our team of experts for a free consultation. Call us at 866-IRS-PROBLEMS (1-866-477-7762) or visit our website at www.TaxResolution.com
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