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Dave Lindorff
Published: Tuesday 21 August 2012
Did Romney use a 2009 IRS tax amnesty to escape being caught in a giant multi-year tax fraud? The 2009 tax return he won't release has the answer.

Is Mitt Romney Trying to Avoid Having to Admit to Massive Tax Fraud?

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A lot of theories have been put forward to try and explain why Romney has allowed his campaign to become bedeviled by charges of tax dodging, but what if what he is hiding is felonious tax fraud?

Okay, so he's taken the legal option of delaying filing his 2011 taxes, which every taxpayer is entitled to do without penalty and without having to give any explanation until October 15 this year (I agree it's a little weird when a super-rich guy who pays accountants by the dozen does this, but hey). The nagging question though is why he hasn't just responded to the demand that he release two years of tax returns like John McCain did in 2008 by simply releasing his 2009 tax filing, along with the 2010 return he already released?

The answer may well be that 2009 was the year that the Treasury Department decided to offer an amnesty from prosecution for tax fraud to any of the tens of thousands of millionaires who were known or suspected to have illegally hidden income abroad in the Cayman Islands or in Swiss banks -- a felony, but one that people thought they'd never be caught at.

That year alone, some nearly 30,000 people, many of them no doubt prominent in society, politics and business, and customers of the finest accounting firms, reportedly voluntarily came forward to the IRS to admit that they had hidden some of the estimated $100 billion in income that crooked rich Americans have for years been secreting away in banks overseas. Under the terms of the program, they were able to just report their fraud, pay the taxes, penalties and interest on the money and then walk away scott free, with no charges and with their returns kept confidential by the agency.

That is, unless they decided to run for national office, where the expectation is that they have to release their income tax returns to the media for inspection.

As journalist Matthew Yglesias has written in Slate, "Romney might well have thought in 2007 and 2008 that there was nothing to fear about a non-disclosed offshore account he'd set up years earlier precisely because it wasn't disclosed."

But the scandal that exploded around Swiss megabank UBS, where a whistleblowing employee released some of the names of wealthy Americans who were being allowed to use the bank's privacy protections to hide their income from the IRS, caused many of America's super-rich, fearing the worst, to rush for an amnesty offered by the IRS, which was more interested in collecting the money than putting a lot of the country's toniest people behind bars. The floodgates opened when the US sued UBS demanding the full list of tax criminals from the bank, and then offered an amnesty to those who came forward voluntarily, reported their fraud to the IRS, and paid the required interest and penalties.

Given Mitt Romney's known predilection for avoiding taxes, it's hard to imagine him not having taken advantage of the Swiss tax dodge, particularly when so many other people of his class were doing it. Hiding income overseas was, back in the early years of this gilded century, the thing to do--the stuff of mirthful asides over cognac at the Club after a bracing game of golf or polo.

But explaining paying lower taxes than your maid or gardner to the public is one thing. Explaining deliberately committing massive tax fraud is another. Plenty of Americans have gone to the slammer for years for defrauding the IRS of mere five-figure sums. Most live in a cultivated fear of the IRS, worrying that they made some mistake on a form or missed a filing deadline, and yet the wealthiest Americans, thanks to the 2009 and subsequent amnesties or partial amnesties, have gotten away with massive fraud, just having to pay penalties and interest, as if they had just inadvertently filed late or made a math error.

None of this is proof that Romney is guilty of felony tax fraud, of course. On the other hand, it is curious that John McCain would have gone for the loopy lady from Wassilla and rejected Romney as his running mate back in 2008. Mitt was seriously in the running as a candidate for the job of VP on the McCain ticket at one point, and the UBS scandal broke right when McCain was picking his running mate. It seems logical that McCain's vetting team would have asked Romney if the scandal might touch him. Maybe they ruled him out of contention when they got the answer.

In any case, running for president is not for sissies, and there is no presumption of innocence in politics. If Romney did not commit tax fraud back in 2008 and earlier, and did not avail himself of the IRS's 2009 tax amnesty program, he should have to prove it by releasing his 2007, 2008 and 2009 taxes, and, if the 2007 and 2008 filings turn out to have been belatedly corrected, he should have to show the original filings too.

No doubt the Obama campaign has figured all this out, which would explain why they are offering Mitt Romney a deal that says: "You release five years of your taxes, and we'll shut up" about demanding even older ones.

It remains to be seen whether conservative and right-wing and libertarian Americans, famous for their loathing of taxes, will decide that Romney is simply doing what they'd all like to get away with doing, and give him a pass on all this tax dodging, or whether they will become so incensed at the idea of this richest of presidential candidates in history cheating on his taxes that they will demand that he prove he didn't do it before he can have their vote.

Meanwhile, if Romney did commit tax fraud courtesy of a Swiss bank arrangement, and he stonewalls it through the campaign weeks ahead, he runs a huge risk that someone will leak the information. After all, federal employees have to realize that four years of a Romney/Ryan administration will be brutal on their job security, benefits and working conditions. And right now Obama is the boss of the federal government, with his own appointees at Treasury and the IRS.

Stay tuned.



ABOUT Dave Lindorff

Dave Lindorff is an investigative reporter, a columnist for CounterPunch, and a contributor to Businessweek, The Nation, Extra! and Salon.com. He received a Project Censored award in 2004. Dave is also a founding member of the online newspaper ThisCantBeHappening! at www.thiscantbehappening.net

It is disheartening to read

It is disheartening to read that some of our wealthiest Americans got away with hiding revenue from the IRS, when we all know middle-class people who did the same thing would have to do more than pay the taxes and the penalty.

But I guess it should not be so surprising. We have known for years that the rich have a version of "justice" that is considerably watered down, whereas the average American gets a more Spartan application of the laws.

But whining about it will do nothing to alleviate it. Voter awareness and participation is the only way to change it, but I do not claim that the party I will vote for is as pure as the driven snow; frankly, they've both been complicit in the velvet-glove treatment accorded the rich.

Getting the money out of our politics, and especially the campaigns, has got to be our goal. The candidates of the major parties should get public funding, and not one penny more. Hey, if the Defense Department can pay $150 for a hammer, our government can afford to give a scaled-down soapbox to the candidates for public office. Let the candidates with the strongest messages prevail.

The wealthy owe this nation

The wealthy owe this nation hundreds of billions of dollars in unpaid taxes. They get amnesty (Obama's choice???!) and we get austerity?!!

I'm just wondering what would

I'm just wondering what would happen to a person who's not rich.
I guess - " Put in jail "
The media will overwhelmed about the issue.
The fact is wealthy people got the right to brake the law, robe, abuse, etc...
while normal people stay as spectator because their right are limited to vote maybe, for the politician that wealthy and corporation impose.

Or did Romney collect the 20%

Or did Romney collect the 20% tax credit that was available (and is still available!) for sending jobs overseas? Congress just recently refused to recind this credit.

Thee is also another

Thee is also another possibility and that is that mittie committed voter fraud. He ws living in Utah for the Olympics (I believe) and called that his permanent residence for tax purposes. Then he wanted to run in Mass. and had to alter his tax return also. While living in Utah did he vote in Mass? Or did he vote in Utah while claiming to live in Mass? Think about it.

Lol, whatever kind of stuff

Lol, whatever kind of stuff you want to speculate about Romney, how does it compare in relevance to the undisputed fact he is was and will be an investment banker?

Because he's a weasel? A

Because he's a weasel? A very, very rich weasel at that?

Hmmmm.

Hmmmm.

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