Korman and the Taxmen
Here's a wacky item from the February 12 issue of Forbes, concerning Gary Kornman, who, as you may recall from earlier posts, is a Dallas attorney awaiting trial in federal court here after pleading not guilty to criminal charges of securities fraud and lying to the Securities and Exchange Commission. And this story was already plenty wacky. Or wack, if nothing else.
IRS Refunds, No Questions Asked
The Internal Revenue Service admits it goofed in paying $2 million in refunds to trusts benefiting Gary Kornman as the feds and others were in civil litigation involving the controversial tax-shelter promoter (FORBES, Apr. 11, 2005), charging he was behind tax underpayment. The agency just sued Kornman for the money back, in a Dallas federal court. He is also awaiting a criminal trial on unrelated federal securities-fraud and lying-to-investigators charges. The IRS pleading says that after ten Kornman trusts filed amended returns on a disputed expense issue, the agency sent nine of them a $220,000 payment each around Christmas 2004. No formal reply yet from Kornman. --Janet Novack