Attorney-at-Law

ROBOSIGNER?

In Uncategorized on 12/23/2016 at 14:29

I’m going to need a lot of runway to deal with the density altitude here, so the following is all subject to connection with Tax Court.

When the subprime mortgage debacle ceased to be “contained,” as a well-known financial expert put it, the cascading home mortgage foreclosure clouds opened, and pleadings rained from the skies.

Many of these mortgages were allegedly held by an electronic nominee, to avoid recording chains of mortgage assignments (and paying fees to local governments). It also kept the true holders well-shielded, as the mortgages were combined into syndicated portfolios, of which pieces were dumped on the fixed-income market.

Needless to say, accurate document preparation was the first casualty.

We then saw the flurry of “robosigners,” junior clerks given titles above their pay grades who signed affidavits and pleadings at the rate of ten a minute, with flailing notaries at their elbows stamping their nights away. None had any idea what they were signing or to what they were swearing.

When the defendants’ bar and the pro bono wolfpack descended and did the first depositions, the game was blown sky-high.

OK, here’s the connection. It’s that obliging jurist Judge David Gustafson, and he’s dealing with the Boss Hoss Section 6751 kerfuffle in Dean Matthew Vigon, Docket No. 28788-14L, filed 12/23/16, a designated hitter that’s a real holiday gift to a blogger.

IRS claims Dean is a frivolity merchant, and whacks him with nine (count ’em, nine) $5K Section 6702 frivolous return chops.

IRS has problems producing returns in question for their motion for summary J.  First they claim no returns were amended returns, although three were checked as amended returns. Next, they have only photocopies of parts of returns, some unsigned ones, and one faxed version.

But that’s not all.

Back in April, when he first got wind that IRS would go for summary J, Judge Gustafson told IRS to verify that it had gotten the Section 6751 Boss Hoss signoff before whacking Dean as aforesaid. IRS asked for a remand and Judge Gustafson, obliging as always, said OK. Counsel told Appeals to make sure that the supplemental NOD named both decider and Boss Hoss.

“In apparent response to this instruction, the Appeals settlement officer noted in her case activity report (Ex. X, p. 112) that the two Forms 8278 showing approval for 2007 were ‘signed’, but one with an ‘illegible signature’. For all of the 2008 and 2009 Forms 8278, the settlement officer noted: ‘Automated signed by auto signature’. The purported signatures that appear on the Forms 8278 do appear to be facsimile signatures.

“The Commissioner’s motion for summary judgment asserts that ‘before each of the I.R.C. section 6702 penalties was assessed, an immediate supervisor of the individual making the determination to assess the penalty approved that determination in writing’. The Forms 8278 do name an ‘Originator’ on line 10a and a ‘Reviewer’ on line 16. However, not in keeping with the remand memorandum, neither the motion nor any of its attachments (as far as we can tell) identify the person approving the penalty determination as being in fact the immediate supervisor of the individual making the initial determination of the penalty. (Rather, in an email to counsel (Ex. V), the settlement officer observed, ‘[T]he form 8278 shows a “Reviewer” signature which everyone seems to constitute as a manager signature but it would be better presented in a court situation if the form was changed to notate Manager or Supervisor as the actual person signing the form.’)” Order, at pp. 2-3. (Emphasis in original).

But Section 6751 calls for “immediate supervisor.” And exactly who this “Reviewer” might be is nowhere stated.

Nor whether there’s a difference for Section 6702 purposes if a return is original or amended. IRS counsel seems to think there is.

IRS’ summary J motion tanks. Trial in February.

Jersey Boys, this is my Christmas present to you. Please copy and enjoy.

Thanks, Judge, Merry Christmas to you and the whole corps de ballet at 400 Second Street, NW.

And best holiday wishes to all my readers.

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