Manhattan U.S. Attorney Obtains Civil Injunction Against New York City Accountant Barring Him From O

[nitpicker]

https://www.justice.gov/usao-sdny/pr/manhattan-us-attorney-obtains-civil-injunction-against-new-york-city-accountant-barring

Department of Justice
U.S. Attorney’s Office
Southern District of New York

FOR IMMEDIATE RELEASE
Monday, August 12, 2019

Manhattan U.S. Attorney Obtains Civil Injunction Against New York City Accountant Barring Him From Organizing, Promoting, Or Selling Abusive Tax Shelters

Geoffrey S. Berman, the United States Attorney for the Southern District of New York announced today that the United States has simultaneously filed and settled a civil injunction lawsuit against MICHAEL N. SCHWARTZ, a certified public accountant in New York City, to permanently enjoin him from organizing, promoting, or selling abusive tax shelters. The tax shelters that SCHWARTZ organized, promoted and sold, exploited foreign currency options contracts and U.S tax rules to generate artificial losses that taxpayers could claim on their tax returns. As part of the settlement, approved on Thursday, August 8, 2019, in Manhattan federal court by U.S. District Judge Vernon S. Broderick, SCHWARTZ agreed to be permanently enjoined from organizing, promoting, or selling any illegal tax shelter.
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The abusive tax shelter transactions organized, promoted, and sold by SCHWARTZ involved complex foreign currency transactions designed to generate artificial losses. Under these schemes, investors entered into foreign currency options contracts, with long and short positions that largely offset each other. The investors then transferred some or all of the foreign currency options, and, exploiting certain tax rules, purportedly generated large losses without also realizing the offsetting gains. SCHWARTZ’s tax shelters therefore resulted in taxpayers claiming large phony tax losses, though they suffered no real economic loss. All told, more than one hundred taxpayers participated in these shelters, which yielded them over $400 million in purported losses.
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[Farmer-Rick]

1. Capitalism at its pinnacle.