<lotax[at]hotmail.com> wrote:

- quote -

This just keeps getting better!

The firm of Friehling & Horowitz is reported to operate out of
a 13-by-18-foot office in a strip mall 30 miles north of
Manhattan.

Misc.Taxes.Moderated has been run for 13 years out of larger
accomodations and I have a running conflict with the pretty
young thing to whom I am married about my commandeering more
space. But admittedly some of that space is used for brewing
and aging Mead and storing brewing equipment.

It is also reported that David Friehling is the immediate past
Presiden of the Rockland County Chapter of the New York State
Society of CPA's. In addition, it is reported that, for the
last 15 years, he has been reporting to the AICPA that his
firm does not do audits!

In my rarely humble opinion, someone caught on video tape
committing a murder could mount a better defense than
Freihling.

A bigger problem is that Freihling is at least the fourth
case of money managers being audited by Larry, Curly, and Moe
audit firms.

It amazes me that none of these goniffs skipped the country.
There must be some third world countries where English is a
common language.

I sincerely hope Freihling's jury is stacked with Accounting
majors! But then is he dumb enough to ask for a jury trial?

Dick

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Stuart A. Bronstein <spamtrap[at]lexregia.com> wrote:

- quote -

I would like to do this with the past few years of interest
payments on now-worthless Washington Mutual bonds.

Was WAMU a legitimate ponzi or not?

Steve

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Han <nobody[at]nospam.not> wrote:
- quote -

There are two aspects to this. First is the money given to Madoff to
manage. To the extent it's not returned there clearly is a theft loss.

The other issue is how to deal with phantom income the investors were
notified they had (on paper) and paid tax on. Do they simply
capitalize it and treat it as a theft loss in the same year as the loss
of principal? Or can they go back and amend old returns that claimed
the income, and get refunds they paid for tax on phantom income?

My recollection is that they can amend old returns, at least those
within the last three years.

Stu

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rdadams[at]panix.com (Dick Adams) wrote in news:gq6q7i$24e$1
[at]reader1.panix.com:

- quote -


--
Best regards
Han
email address is invalid

--
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On Mar 23, 1:41�am, lo...[at]hotmail.com wrote:
- quote -


--
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"Will that audit firm still be in business in 2010?" asks Dick.

Madoff's auditor was arrested late last week. Charged with nine (I
think) counts of felony this and felony that. Wire fraud, mail fraud,
filing false documents with intent to conspire to join in the
commission of a felonious and fraudulent act by deception and
subterfuge. Something like that.

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In article <gq6q7i$24e$1[at]reader1.panix.com> ,
Dick Adams <rdadams[at]panix.com> wrote:
- quote -

I've heard it was some small guy operating out of his attic.

The fact it wasn't a well-known firm should have been, um,
suspicious.
--

ArtKamlet at a o l dot c o m Columbus OH K2PZH

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The real problem with Madoff is that there were economists
and financial analysts who were telling the SEC for a
number of years that Madoff's returns smacked of a Ponzi
scheme.

This case reminds me of Ernst & Ernst v. Hochfelder where
Leston B. Nay of First Securities in Chicago (1968) found
himself in the same situtation as Madoff. Nay killed his
wife and committed suicide leaving behind a note explaining
what he had done.

One major difference is that Nay's private investment
scam was limited to his relatives and social acquaintances,
and was unknown to his company's personnel, his auditors,
the SEC, and the media, e.g., the Wall Street Journal, the
Noo Yawk Times, etc. So unlike Madoff, there was no one
monitoring his performance results.

At the risk of sounding like Chicken Little of "The Sky is
Falling" fame, maybe it is time for the SEC to take over
auditing of the financial industry. No, wait a minute.
They had a heads up on Madoff and failed to investigate.
Maybe the sky is falling.

The tax issues are rather simple. Investors file amended
returns and get to carry-foward huge capital losses. Maybe
some of those deep-pocket investors will go to court to get
their losses recatagorized as theft losses.

The social issued are extremely significant. Who was auditing
Madoff? Will that audit firm still be in business in 2010?

Dick

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Han <nobody[at]nospam.not> wrote:

- quote -

I'm fuzzy on the details but I think if you have no more than
99 investors the reporting requirement drop off dramatically.
Madoff did not have too many direct investors, but instead relied
on feeder funds. Many of those were probably LP/LLC's and
issued monthly statements (purely as a courtesy) and then 1065/K1's
annually.

The lack of normal 1099's probably fed in to the allure of
being in with Madoff, the so-called "I've got a guy" syndrome.

Steve

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I heard (don't know from my own experience <haha> ) that people who were
"investing" with Madoff never received 1099 forms, and had to hand their
monthly statements to their accountant to report their Madoff income, now
declared phantom.

Didn't the lack of 1099 filing with the IRS by Madoff ring a bell (like
WARNING!!! something funny is going on)? Didn't the IRS check with the
"brokerage" that didn't report the income the taxpayers did report?

--
Best regards
Han
email address is invalid

--
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