Feeds

EMC founder clashes with IRS over 'tax evasion' scheme

Gimme back my $62m

Top three mobile application threats

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. ®

Application security programs and practises

More from The Register

next story
BBC goes offline in MASSIVE COCKUP: Stephen Fry partly muzzled
Auntie tight-lipped as major outage rolls on
iPad? More like iFAD: We reveal why Apple fell into IBM's arms
But never fear fanbois, you're still lapping up iPhones, Macs
Nadella: Apps must run on ALL WINDOWS – PCs, slabs and mobes
Phone egg, meet desktop chicken - your mother
White? Male? You work in tech? Let us guess ... Twitter? We KNEW it!
Grim diversity numbers dumped alongside Facebook earnings
Microsoft: We're making ONE TRUE WINDOWS to rule us all
Enterprise, Windows still power firm's shaky money-maker
HP, Microsoft prove it again: Big Business doesn't create jobs
SMEs get lip service - what they need is dinner at the Club
ITC: Seagate and LSI can infringe Realtek patents because Realtek isn't in the US
Land of the (get off scot) free, when it's a foreign owner
Dude, you're getting a Dell – with BITCOIN: IT giant slurps cryptocash
1. Buy PC with Bitcoin. 2. Mine more coins. 3. Goto step 1
There's NOTHING on TV in Europe – American video DOMINATES
Even France's mega subsidies don't stop US content onslaught
prev story

Whitepapers

Top three mobile application threats
Prevent sensitive data leakage over insecure channels or stolen mobile devices.
Implementing global e-invoicing with guaranteed legal certainty
Explaining the role local tax compliance plays in successful supply chain management and e-business and how leading global brands are addressing this.
Top 8 considerations to enable and simplify mobility
In this whitepaper learn how to successfully add mobile capabilities simply and cost effectively.
Application security programs and practises
Follow a few strategies and your organization can gain the full benefits of open source and the cloud without compromising the security of your applications.
The Essential Guide to IT Transformation
ServiceNow discusses three IT transformations that can help CIO's automate IT services to transform IT and the enterprise.