Many federal white-collar prosecutions are for tax crimes, such as tax evasion, failure to file income tax returns, or tax fraud. There are some special considerations to keep in mind if you are under investigation for violations of the Internal Revenue Code.
In a bank fraud case, for example, the federal investigative agency is typically the FBI. The FBI usually works directly with the local United States Attorney’s office. When the FBI has completed its investigation, it forwards its case to the local U.S. Attorney’s office, and the local office determines whether to prosecute or not.
Procedures In Tax Crime Cases
In tax crime cases, the procedure is significantly different. The typical criminal tax case is investigated by the Internal Revenue Service Criminal Investigation Division (“CID”). CID investigators are federal agents trained in law enforcement techniques and tactics. Most are also accountants by trade, and many have achieved their CPA. There are CID offices throughout the country.
When a CID agent completes an investigation and recommends that an individual be prosecuted, there are at least two stages of review by Internal Revenue Service attorneys prior to the approval of prosecution. Once the Internal Revenue Service approves prosecution at its highest level, the case is forwarded to the United States Department of Justice Tax Division in Washington, DC, where federal prosecutors specializing in criminal tax violations review the case and decide whether or not to authorize prosecution. If the Department of Justice Tax Division in Washington approves prosecution, the case is sent to the local US Attorney’s office with the direction that the individual or individuals named be indicted and prosecuted for the offenses alleged.
Advantages Of Approval Process
In tax crime cases, the multi-tiered approval process can work to your advantage. The process gives you a number of different opportunities to derail a federal criminal case before it ever gets to grand jury. At each of the IRS approval levels and at the Department of Justice Tax Division level, your lawyer will have the opportunity to schedule a conference where he or she can sit down with government attorneys and attempt to convince them to decline prosecution of the case. If the government has a strong case against you, it is unlikely that he or she will be successful in convincing either the IRS or the Department of Justice Tax Division to refrain from prosecuting. However, if there are misunderstandings that can be explained away and the government can be convinced that there was no criminal conduct, you have the opportunity to convince the government to decline prosecution prior to grand jury. It is always less stressful to have your attorney address matters in meetings with government attorneys than to present your side of the story to a jury at a federal criminal trial.
Also, in tax crime cases it is important to have an attorney who is not only well experienced in federal criminal matters, but who also has had significant experience in federal criminal tax cases. If you are comfortable with a lawyer who is experienced in federal criminal defense but lacks tax experience, consider adding a former CID agent to your defense team. However you accomplish your objective, you will want both federal criminal defense and tax crime experience on your side.
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