Criminal Justice

Three Ex-Jenkens Partners Indicted for Work on Questionable Tax Shelters

Three former lawyers at the defunct law firm Jenkens & Gilchrist, including the head of its tax practice, have been indicted on charges of scheming to defraud the Internal Revenue Service by promoting and defending questionable tax shelters.

The indictment claims that former tax head Paul Daugerdas made $95.7 million in fees over four years in the scheme, according to the Chicago Tribune and the New York Times. In all, seven professionals were charged, including Denis Field, the former chairman and chief executive of BDO Seidman who was a lawyer and accountant. The indictment says the seven defendants earned a total of $180 million in fees from the tax shelter work, the Tribune says.

Daugerdas and the two other lawyers charged, former partners Erwin Mayer and Donna Guerin, all worked in Jenkens’ Chicago office. The indictment also charges Daugerdas and Mayer with tax evasion based on allegations they used phony tax shelters to cut their personal taxes between 1999 and 2001, Texas Lawyer reports.

Spokeswoman Margarite Wypychowski said Daugerdas “firmly believes that the tax advice provided to his clients was well within the scope of then-existing federal tax law.” A lawyer for Mayer told the Times that his client “acted in good faith in providing tax advice to his clients,” and a lawyer for Guerin denied the charges against her. Field’s lawyer told the Tribune he provided “legitimate tax planning.”

Texas Lawyer posted the indictment (PDF).

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