Although much has been written about the IRS whistleblower program which last year saw a whistleblower collect $104 million in rewards for reporting tax evaders, not much has been mentioned about whistleblowers who report companies that purposely do not pay their sales taxes. Most states have sales taxes on goods sold or exchanged in those states. The amount varies from 5-7% but companies selling products are required to pay sales taxes in those states with such laws and where the transaction occurs in those states. Even though the laws are clear, alot of companies, especially those in offices in various states, try to evade the taxes by just not paying them. In addition, even in those states that do not have actual whistleblower laws on the books, whistleblowers with information about sales tax fraud can usually negotiate a reward of a significant percentage of the moneys recovered by the states. It usually ranges from 15-35% of the moneys collected. It helps to have an experienced lawyer. The information has to be original and generally the amounts of sales tax fraud must be substantial for the states to be interested. It also helps to have documentary support for your allegations in the form of invoices or other documents showing the sales. There have been some very large cases. In one case pending in New York State, Sprint has been charged with seeking to dodge over $300 million in sales taxes. With interest and penalties, that amount could run the company in excess of $700 million and the whistleblower could receive up to $200 million, which would be the single largest whistleblower award relating to tax fraud ever rendered. If you are aware of corporate tax fraud, contact attorney Jeffrey Newman for a free consultation. Jeffrey Newman represents whistleblowers. Jeffrey.Newman1@gmail.com
Psychiatric and psychotherapy services were provided to patients whose dimentia and cognitive disorders made them unable to benefit from the treatment but Medicare was billed through the nose. The Department of Justice charged the company with billing for nearly 91,000 exams that were duplicative and failed to comply with Medicare rules. The company, Park avenue Medical Associates agreed to pay One Million Dollars to settle the claim. Interestingly the whistleblower in the case is Zachery Wolfson, the son of the company’s Chief Medical Officer and founding partner, Mitchell Wolfson MD. The son will collect as much as $250,000 for filing the original complaint under The False Claims Act. Jeffrey Newman represents whistleblowers. email@example.com
A new plan released by financial chiefs from the United states, Canada and other leading world economies will make it a lot tougher for multinational companies to stash their profits offshore to evade taxes. There will be two beneficiaries to this. First, the countries will benefit because the companies will pay more in taxes. In addition, there will be new programs for whistleblowers to reveal tax evasion, allowing them to collect rewards for revealing the location of the moneys, similar to the whistleblower programs in the Securities and Exchange Commission and the False Claims Act. Major global companies have been paying low taxes, including Google, Apple, Facebook and Starbucks by setting up offshore operations where they keep the moneys protected from tax authorities. The Organization for Economic Co-operation and Development (OECD) based in Paris, has created a 15-point plan to close loopholes and allow countries to tax profits held in offshore subsidiaries. The plan also includes rules preventing companies from escaping taxes by putting patent rights into shell companies, taking interest deductions in one country without reporting taxable profits in another and also by forcing them to disclose to regulators where they put their income around the world. A whistleblower, even if living outside the United States can report tax evaders and receive a reward of up to 30% of the moneys recovered. Jeffrey Newman represents whistleblowers. firstname.lastname@example.org (free consultation)
By Jeffrey A. Newman
The former Gallup exec who unveiled information alleging that Gallup knowingly overstated its estimated labor hours in proposals to the U.S. Mint and State Department, has been awarded $1.9 million for doing so. Michael Lindley Gallup’s former director of client services will receive that money under the federal whistleblower law The False Claims Act (FCA) which allows individuals to sue for fraud on the government. The lasuit filed by Lindley last year resulted in Gallup paying $10.5 million to the government and also alleged that Gallup improperly engaged in employment negotiations with a then Federal Emergency Management Agency (FEMA) official, in order to obtain a FEMA subcontract at an inflated price and additional FEMA funding after the subcontract had been awarded. Jeffrey Newman represents whistleblowers who report fraud on the government. email@example.com
According to the Wall Street Journal, emails and other documents reviewed by the paper’s reporters reveal information uncovered by a tipster alleging that Glaxo’s China sales staff provided doctors with speaking fees, cash payments, lavish dinners and all expenses paid trips in return for prescribing the drug company’s products. Glaxo says it is looking into the matter. Like in the U.S., patients in China need a doctor’s prescription to buy regulated drugs and drug sales persons meet frequently with doctors to try to get them to prescribe products. However, unlike the U.S., the government controls all of China’s health care system so any purchased are through government paid physicians. Under the U.S. Foreign Corrupt Practices Act it is illegal for companies with significant U.S. operations to bribe foreign officials or their agents in exchange for business. Whistleblower tipsters are now coming forward to be part of the Securities and Exchange Commission’s new whistleblower program allowing the tipsters a reward of up to 30% of the moneys recovered. The Glaxo whistleblower says that between 2004 through 2010 Glaxo regularly gave cash to its sales staff in China and some of that went directly to doctors at Chinese hospitals in return for prescribing drugs from the company. Recently Glaxo settled a case with the U.S. Department of Justice relating to its drug marketing practices. Under the new SEC program, whistleblowers may come forward anonymously through counsel, thereby protecting themselves. Jeffrey Newman represents whistleblowers. firstname.lastname@example.org. www.JeffreyNewmanLaw.com
The United States Securities and Exchange Commission is now examining a number of Chinese companies that are trading on the U.S. stock exchange where it is shown that there are financial irregularities or fraud including foreign bribes. As a result, as of December 2012, over 45 Chinese companies were delisted from the U.S. stock exchange due to mismanagement, financial irregularities and other compliance issues. In addition, a growing number of cases and investigations are occurring as a direct result of whistleblowers coming forward under the new SEC whistleblower program allowing for information to be provided anonymously though counsel. The whistleblowers are allowed to collect up to 30% of what the government recovers, regardless of where they live and the largest payment to a whistleblower came last year with an award of $104 million to a former Swiss banker. Last week, the SEC charged the China, based advertising company China Media Express with fraud and misleading investors. The company and its CEO Zheng Cheng are accused of overstating values of cash balances to the SEC by up to 40,000 percent. According to reports, in 2009 the company reported it had $57 million in cash on hand when it had only $141,000. This allowed the company to attract investors and raise money from stock sales. Other U.S. delisted China based firms include SinoHub Inc.; China North PEast Petroleum Holdings Ltd.; China Medical Technologies Inc.; and Sino Clean Energy Inc. Jeffrey Newman represents whistleblowers. email@example.com.
Fifty-five hospitals in the U.S. will pay more than $34 million to settle allegations that the health care facilities submitted false claims to Medicare for khyphoplasty procedures. A kyphoplasty surgical procedure is designed to stop the pain caused by a spinal fracture using a special balloon fed to the vertebrae via a tube. In many cases, kyphoplasty can be performed safely and effectively as an outpatient procedure without any need for a more costly hospital admission. The government alleged that hospitals billed Medicare for for the more costly inpatient procedures in order to increase their Medicare billings. In addition to this settlement, the Justice Department also reached a settlement with 100 other hospitals totaling over $75 million and Medtronic Spine LLC also paid $75 million to settle allegations that the company defrauded Medicare by counseling hospital providers to perform the surgeries in patient. Two Whistleblowers are expected to receive over 20% of all moneys collected from these settlements as part of their reward allowed under the False Claims Act (FCA). Jeffrey Newman represents whistleblowers. (email):firstname.lastname@example.org . 1-800-682-7157
The IRS and Securities and Exchange Commission are finding unusual sources of information–international financial whistleblowers who are revealing enormous amounts of sensitive information about banks and large corporations that are evading taxes and defrauding investors and stock holders. The new breed of whistleblowers are sophisticated enough to know that they can reveal information under the SEC or IRS whistleblower programs and still remain anonymous, a new twist to these whistleblower programs expected to make all the difference to these individuals. It allows them to continue working without the fear of reprisals. It also allows them to collect the rewards of up to 30% of what the government recovers and in many of these cases, especially with regard to bank insiders in Switzerland, the Isle of Man, Cayman Islands as well as other major tax havens in the Caribbean, the fraud is massive. The Government Accounting Office estimates that trillions of dollars in taxes are lost to foreign tax havens which allow individuals and corporations to illegally secrete their moneys from Uncle Same because they money is kept outside the U.S. . Up until now, that has worked, for the most part. But as there is a significant incentive for whistleblowers to reveal this fraud,the jog may be up. One whistleblower was awarded $104 million last year as his share of the recovered moneys. That award generated significant press and since then, calls have come from the whistleblowers. If you are aware of financial fraud, tax evasion or fraudulent financial statements filed by publicly traded companies, contact Jeffrey Newman who represents whistleblowers. Jeffrey.Newman1@gmail.com. 1-800-682-7157. free consultations.
A few weeks ago, US prosecutors closed down currency operator Liberty Reserve for running one of the largest money laundering schemes ever uncovered, according to prosecutors. Virtual currencies are systems to allow anonymously transferred funds to be used as currency on the internet. What is it you ask? It is electronic money used for transactions with real goods and services and because they exist entirely within a virtual setting it is hard to tax the transactons. For example Bitcoin users can use the virtual currency to engage in real economic activity but as they are anonymous, they can evade taxes.Digital currency is electronic money that can be passed between individuals without the use of the traditional banking or money transfer system. Bitcoin, which has been embraced by a number of venture capitalists in Silicon Valley, exists through an open-source software program that any users with enough skill and computing power can access. It is not managed by a single company or government. Users can buy bitcoins through exchanges that convert real money into the virtual currency. The problem is that the unscrupulous have also found virtual currency and are using it to launder money and evade taxes within the US. The Government Accountability Office (GAO) has stated that the IRS must to more to investigate tax evasion using virtual money on line. Virtual money has now been deemed cyber-currency and it has resulted in misuse to hide unreported income from the IRS. Whistleblowers with unique or inside information about tax evasion through use of cyber funds can report this and may receive up to 30% of what the government recovers. Jeffrey Newman represents whistleblowers. email@example.com
A Chicago hospital, its owner, the CFO and five physicians have been charged with Medicare fraud saying that they gave or received kickbacks in return for patient referrals and some with providing unneeded tracheotomies. This surgery is typically used to open air passages directly into the windpipe for patients who can’t breathe otherwise. Based on FBI secret tape recordings, the court filings say that a Sacred Heart pulmonologist kept patients too sedated to breathe on their own, then ordered unneeded tracheotomies for them, enabling the for-profit hospital to earn as much as $160,000 per case. An FBI affidavit also includes a quote from the hospital’s owner asking the pulmonologist to provide two more tracheotomy cases for the hospital soon, before inspectors, who had visited the hospital before March, returned. A Sacred HEart surgeon performed tracheotomies on 28 Medicare patients between early 2010 and January, according to the affidavit. Five died within two weeks, a death rate three times the statewide rate in Illinois. The affidavit says that tracheotomy patients were lucrative for the doctors as well as they could bill $160 each time they visited a tracheotomy patient at the hospital. Sacred Heart is located on Chicago’s west side in a neighborhood with half the median household income and twice the poverty rate of the city overall. It has been filling less than half its 119 beds in recent years and almost all patients are Medicare or Medicaid recipients. Despite this, the hospital reported a jump in profit to $9.4 million for the year ending June 30, 2012 up $1.3 million from the prior year. Jeffrey Newman represents whistleblowers.