For Immediate Release
Houston Attorney Victorious in Suspension of IRS Attorneys
For the First Time in US History, Two IRS Attorneys have been Suspended by the IRS and their State bars for Deceiving and Defrauding the US Tax Court
Contact: Rod Mitchell @ 281-350-5506
[Dateline - Houston, TX - August 22, 2004] On August 11, nearly eighteen months after IRS attorneys Kenneth W. McWade and Richard A. Sims were sited by the 9th Circuit Court of Appeals in San Francisco for deception, misconduct, withholding evidence, and defrauding the court (read the Appelate Ruling) the two attorneys have been suspended by their state bars, and the IRS has suspended them indefinitely.
This is the first time in US history that IRS attorneys have been suspended by the tax court and their state bar (see NY Times article below).
Had it not been for the Herculean efforts of Houston Appellate attorney, Michael Louis Minns, Sims and McWade's actions would have gone unpunished.
After winning the 9th Circuit's ruling for 1,300 airline pilots, Minns contacted the US Tax Court to demand disciplinary action. After several months of letter writing and phone calls the US Tax Court did not respond, so Minns contacted each of the fifty state bar associations to determine where the two attorneys were licensed. He discovered that Sims was licensed in Arkansas and McWade was licensed in Oregon. After being advised of the 9th Circuit's ruling, both states immediately launched investigations, and Minns was named as the lead witness in the Arkansas case. Oregon advised Minns of their ruling on August 11th against McWade.
On January 17, 2003, the Ninth Circuit handed down its ruling to overturn a 1991 Federal Tax Court ruling, whereby 1,300 airline pilots had been assessed more than $10.2 billion in back taxes, penalties and interest. The IRS case surrounded a tax-sheltered trust they the pilots has established for their children and their own retirement.
These latest actions will prompt the largest refunds ever in IRS history, totaling in excess of $2.6 billion.
2 Ex-I.R.S. Lawyers' Licenses Suspended for Misconduct
Published: August 21, 2004
he law licenses of two former Internal Revenue Service lawyers have been suspended for two years after a federal court ruling last year that they defrauded the courts so that the I.R.S. could win 1,300 tax shelter cases.
W. Kenneth McWade was suspended by the Oregon Supreme Court in an order dated Aug. 10 and released yesterday by the Oregon State Bar.
Four months ago Arkansas officials suspended the license of William A. Sims.
The United States Tax Court has also suspended both lawyers for two years, and the I.R.S. director of practice has suspended them indefinitely.
The suspensions followed complaints brought by Michael Louis Minns, a Houston lawyer who represented 124 of the tax shelter buyers, most of them airline pilots. One buyer is seeking a $6 million refund.
The Federal Court of Appeals for the Ninth Circuit in San Francisco found in January 2003 that the lawyers had defrauded the court by making a corrupt deal with a few of the pilots who bought tax shelters in the 1970's and 1980's. Under the deal, no tax-collection actions in regard to the shelters would be taken against these pilots in return for testimony that would hurt the others.
The court called this "extreme misconduct" and asked why the I.R.S. had not disciplined the lawyers, each of whom was paid a $1,000 bonus for his work on the cases.
Mr. Minns then asked the I.R.S. in which state each was licensed so that he could seek their disbarment. The I.R.S. refused, saying disclosure of their law licenses would violate their confidentiality.
In fighting suspension, the two lawyers filed papers contending that they had acted properly.
Mr. McWade, reached at home in Hawaii, said, "I guess the court has decided that Oregon lawyers are not entitled to due process." Mr. Sims did not respond to voice mail and e-mail messages.
The two men left the I.R.S. after their conduct came under scrutiny.