Minimum Competence - Daily Legal News Podcast
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Legal News for Thurs 1/11 - IRS Major Win in Fraud Case, Trump's Civil Trial Nears End, House Republicans Move Against Hunter Biden and Girardi Upcoming Trial

Legal News for Thurs 1/11 - IRS Major Win in Fraud Case, Trump's Civil Trial Nears End, House Republicans Move Against Hunter Biden and Girardi Upcoming Trial

We have the IRS's major win in a tax fraud case, Trump's nearing civil fraud trial conclusion, House Republicans moving against Hunter Biden, and Thomas Girardi's upcoming fraud trial.

Alice Paul standing in a field, pencil sketch.

This Day in Legal History: Birth of Alice Paul 

January 11 marks an important date in legal history, as it is the birthdate of Alice Paul, a pivotal figure in the women's suffrage movement in the United States. Born on this day in 1885, in Mount Laurel, New Jersey, Paul grew up in a well-to-do Quaker family known for its commitment to equality and social justice. Her upbringing played a significant role in shaping her advocacy for women's rights.

Alice Paul attended Swarthmore College and later went on to earn a doctorate in social work from the University of Pennsylvania. Her academic journey took her to England, where she joined the women's suffrage movement, learning militant tactics from Emmeline Pankhurst's Women's Social and Political Union. Paul returned to the United States in 1910, bringing with her a new vigor and approach to the suffrage movement.

In the U.S., she found the existing suffrage movement lacking in dynamism and urgency. To revitalize it, she joined the National American Woman Suffrage Association (NAWSA) and quickly became the head of their Congressional Committee. Her first major campaign was the organization of a suffrage parade in Washington, D.C., on March 3, 1913, strategically timed to coincide with President Woodrow Wilson's inauguration.

Paul's tactics were notably more aggressive than those of her predecessors. She organized pickets, parades, and strikes, which often led to her and other suffragists being arrested. Her efforts, however, significantly boosted public awareness and support for the suffrage cause.

In 1916, Paul formed the National Woman's Party (NWP), a more radical group focused solely on securing a constitutional amendment for women's suffrage. The NWP's relentless campaigning, including picketing the White House, was instrumental in leading to the passage of the 19th Amendment in 1920, granting women the right to vote.

Following the suffrage victory, Alice Paul continued her advocacy, authoring the Equal Rights Amendment in 1923, a piece of legislation designed to guarantee equal legal rights for all American citizens regardless of sex. Though it has yet to be ratified, the ERA remains a testament to her lifelong commitment to gender equality.

Alice Paul's legacy is profound, and her strategies and philosophies continue to influence civil rights movements. She passed away on July 9, 1977, and was laid to rest in the Westfield Friends Burial Ground in Cinnaminson, New Jersey, continuing to inspire generations of activists in the fight for equality. Happy 138th birthday, Ms. Paul.

The recent legal victory of the IRS in a significant tax fraud case involving syndicated easements could mark a turning point in the government's approach to these controversial tax transactions. In the case, real estate developer Jack Fisher, aged 71, was sentenced to 25 years in prison and ordered to pay $458 million in restitution by the US District Court for the Northern District of Georgia. His co-defendant, James Sinnott, received a 23-year sentence and a similar restitution order.

The case centered around a fraudulent scheme using syndicated easements, where partnerships buy land and donate development rights to claim large tax deductions. Fisher and Sinnott's operation, which started in 2008 and expanded in 2013, involved inflated appraisals and forged documents. This type of transaction has seen nearly $36 billion in unwarranted deductions claimed from 2010 to 2018, leading to bipartisan legislation in 2022 to curb such practices.

The substantial prison sentences and restitution in this case represent a rare and significant win for the government against a practice that has long eluded effective regulation. The outcome could influence future prosecutions and IRS cases in Tax Court, making it easier for the IRS to win against similar deals. The case highlights the need for the IRS to effectively review returns and manage valuation-based Tax Court cases, which have been both challenging and time-consuming.

IRS Criminal Investigation Chief Jim Lee emphasized the agency's commitment to tackling abusive tax shelters using their financial expertise. The magnitude of the sentences and restitution should serve as a deterrent to those still promoting syndicated transactions. Legal experts and observers note that the case exposes the blatant valuation abuses in these transactions and underscores the urgency for individuals involved in similar activities to seek legal advice.

The case against EcoVest, a company promoting syndicated easements, was settled in March 2023 without admission of wrongdoing, although the government had alleged $3 billion in improper deductions. The outcome of Fisher and Sinnott's case is seen as a warning to others in the industry, signaling the government's increased scrutiny and potential legal repercussions in such tax evasion schemes.

IRS Victory in Land Tax Case Could Speed Government Crackdown

The civil fraud trial involving former U.S. President Donald Trump in New York is nearing its conclusion, with closing arguments scheduled for Thursday. Trump is facing nearly $370 million in penalties as New York Attorney General Letitia James alleges that he and his associates significantly inflated the value of his assets for over a decade to obtain better financial terms from banks. Trump denies these allegations, claiming the trial is politically motivated and a hindrance to his 2024 presidential campaign.

Justice Arthur Engoron, who is presiding over the trial, rejected Trump's request to deliver his own closing arguments, aiming to avoid a "campaign speech" scenario. This trial is one of several legal challenges Trump faces amid his campaign to contest the 2024 election against President Joe Biden. Engoron will deliver the verdict later, without a jury, after previously finding Trump liable for fraud in September. The focus of the trial has been on determining the amount Trump should pay in ill-gotten gains.

Trump has expressed frustration with Engoron's handling of the trial, including a gag order and a $15,000 fine for violating it. The state's lawyers have presented evidence that Trump consistently overvalued his assets. Trump, in his testimony, defended his valuations and accused James and Engoron of political bias. A notable moment in the trial was the testimony of Michael Cohen, Trump's former lawyer, who claimed Trump directed him to manipulate asset values on financial statements.

Trump's children, Donald Jr., Eric, and Ivanka, also testified, denying involvement in preparing the financial statements. While Ivanka is not a defendant like her brothers, all three have denied any wrongdoing.

In addition to this trial, Trump faces potential criminal trials related to his attempts to overturn the 2020 election, handling of classified documents, and a hush money case in New York. He has pleaded not guilty in all these cases.

Trump's $370 million civil fraud trial set to conclude in NY | Reuters

U.S. House Republicans are moving towards holding Hunter Biden, son of President Joe Biden, in contempt of Congress. This action follows Hunter's refusal to testify in a closed-door deposition concerning an impeachment probe of his father. Hunter unexpectedly appeared at a House Oversight Committee meeting, causing a stir and leading to heated exchanges between lawmakers.

Republican Representative Nancy Mace criticized Hunter for not attending the deposition, accusing him of being afraid. The House Republicans claim that President Biden and his family improperly benefited from policy actions during his vice-presidency from 2009 to 2017, allegations both the White House and Hunter Biden deny.

Hunter Biden is facing separate legal issues, including a federal court appearance in Los Angeles regarding unpaid taxes of $1.4 million and charges in Delaware related to lying about drug use while purchasing a handgun. He has pleaded not guilty to the Delaware charges.

Democratic Representative Jared Moskowitz questioned why the committee refused Hunter's offer to testify then and there. Hunter Biden's attorney, Abbe Lowell, stated that they had previously offered to cooperate with the House committees but were ignored. Lowell criticized the subpoena for a private deposition as a tactic misused by Republicans.

The full House usually votes on contempt of Congress certification following a committee vote. Since 2008, the House has held 10 people in contempt, but the Justice Department has only sought indictments for two: Steve Bannon and Peter Navarro, advisors to former President Donald Trump. There is no precedent for a sitting president's family member being held in contempt of Congress. Contempt of Congress carries a penalty of up to $100,000 and imprisonment for one to 12 months.

House Republicans move toward holding Hunter Biden in contempt of Congress | Reuters

Thomas Girardi, a disbarred plaintiffs attorney, is set to stand trial for fraud beginning May 21 in Los Angeles, significantly earlier than the February 2025 date his lawyers requested. The trial's scope will be narrowed to focus on four specific cases brought by Girardi's clients, as decided by the prosecutors to avoid delays. The Assistant US Attorney, Ali Moghaddas, emphasized that the trial would not go beyond the indictment's scope.

Judge Josephine Staton of the Central District of California remarked that the case doesn't seem overly complex and has been pending for quite some time. Girardi’s public defenders had sought a later trial date to prepare adequately, especially after focusing on assessing Girardi's ability to stand trial due to his cognitive impairment.

In early January, Judge Staton determined that Girardi had mild-to-moderate cognitive impairment but had exaggerated his decline to avoid trial. The prosecution expressed concerns that any further delay might again raise questions about Girardi's competency.

The discovery process has been extensive, with the government subpoenaing over a dozen banks, the state bar, and bankruptcy trustees for complaints against Girardi and others. However, much of the received documentation was deemed irrelevant to the current case. The prosecution has been asked to highlight key documents for the defense.

Girardi faces wire fraud charges in Los Angeles related to allegedly stealing millions from clients in litigation over the 2018 Lion Air Boeing 737 MAX crash. He also faces charges in Illinois. The case will reconvene on February 23 to discuss discovery matters.

Girardi Trial Set for May, Scope Is ‘Significantly’ Narrowed (1)

Minimum Competence - Daily Legal News Podcast
Minimum Competence
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