Feeds

EMC founder clashes with IRS over 'tax evasion' scheme

Gimme back my $62m

Intelligent flash storage arrays

Richard Egan, ex-marine and a founder of EMC, is suing the US Internal Revenue Service for the return of $62m taken from him after the IRS decided option trading arrangements he had entered into were a tax avoidance scam. Egan insists the trades were genuine.

EMC-founder Richard Egan

Egan, an ex-US ambassador to Ireland, is involved in the case because he and his wife - both ex-board members of storage giant EMC - together with three other people set up two partnerships which traded in options and made losses. These losses offset investment gains made in other activities, and reduced the partnership members' tax liabilities in the 2001 and 2002 tax years.

The case is being held in Worcester, Mass, in front of District Court Judge F Dennis Saylor IV. There will be no jury as it is a civil case.

The IRS asserts that the option trades were essentially a fraud, existing only on paper, with no intention other than to create a lowered tax bill. Egan says he merely followed the advice of lawyers, accountants and tax advisors. He claims the partnerships were set up to reduce his exposure to short-term volatility in the value of his massive holdings of EMC stock. The IRS says this group of people was just an off-the-shelf crew used to try and turn a defrauding tax shelter into a legitimate tax reduction exercise.

Egan is the lead partner in each partnership for tax purposes. Forbes magazine reckons he is worth $1.4bn and ranked 355 in a list of the richest Americans. He resigned from EMC's board in September 2001 to represent the USA in Ireland, when the tax avoidance or reduction measures were taking place. President Bush, a grateful recipient of funds from Egan, nominated him to be Ambassador Extraordinary and Plenipotentiary of the United States. During his two years in Ireland he was described as both invisible and bullying, as well as being bored with Dublin. Extraordinary indeed.

More on all this here. ®

Secure remote control for conventional and virtual desktops

More from The Register

next story
WHY did Sunday Mirror stoop to slurping selfies for smut sting?
Tabloid splashes, MP resigns - but there's a BIG copyright issue here
Spies, avert eyes! Tim Berners-Lee demands a UK digital bill of rights
Lobbies tetchy MPs 'to end indiscriminate online surveillance'
How the FLAC do I tell MP3s from lossless audio?
Can you hear the difference? Can anyone?
Google hits back at 'Dear Rupert' over search dominance claims
Choc Factory sniffs: 'We're not pirate-lovers - also, you publish The Sun'
Inequality increasing? BOLLOCKS! You heard me: 'Screw the 1%'
There's morality and then there's economics ...
While you queued for an iPhone 6, Apple's Cook sold shares worth $35m
Right before the stock took a 3.8% dive amid bent and broken mobe drama
prev story

Whitepapers

Providing a secure and efficient Helpdesk
A single remote control platform for user support is be key to providing an efficient helpdesk. Retain full control over the way in which screen and keystroke data is transmitted.
Intelligent flash storage arrays
Tegile Intelligent Storage Arrays with IntelliFlash helps IT boost storage utilization and effciency while delivering unmatched storage savings and performance.
Beginner's guide to SSL certificates
De-mystify the technology involved and give you the information you need to make the best decision when considering your online security options.
Security for virtualized datacentres
Legacy security solutions are inefficient due to the architectural differences between physical and virtual environments.
Secure remote control for conventional and virtual desktops
Balancing user privacy and privileged access, in accordance with compliance frameworks and legislation. Evaluating any potential remote control choice.