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It Was The Best of Bribes, It Was the Worst of Bribes: A Tale of Two IRS Bribes
Written: December 19, 2010

In June 2009, Roger Anthony Coombs, age 41, started working for the Internal Revenue Service (“IRS”), where he routinely audited individuals and entities to determine if accurate reports of tax liabilities had been submitted by them to the federal government. About a year into his IRS job, on May 6, 2010, Coombs was engaged in a routine audit of a small Minnesota company.  As part of his review, he met with the two owners of that company at the offices of their accountant.

A funny thing happened when the accountant was out of the office -- Coombs suggested that the owners and he meet somewhere else, and pointedly without the accountant. That meeting was scheduled for May 8thLet's call this dramatic foreshadowing.

Making the Situation Manageable

May 8th comes and the seemingly clandestine meeting goes ahead; however, one of the business owners was troubled because he secretly recorded the conversations, during which Coombs claimed that his calculations had determined that the small company owed  $60,000 to the IRS.

Oh, my. What to do. What to do about that five-figure tax bite. To which Coombs mused aloud, and he offered to make the “situation” more “manageable.”

And just how did the IRS employee propose to manage the situation? Apparently, he offered to alter the audit in a way that the IRS would agree to accept only $11,000.  And how would he manage to accomplish that? Seems that Coombs suggested that a payment to him of $9,700 would be the perfect token of appreciation.

Down Payment

The two owners and Coombs then agreed to adjourn until May 19th, at which time they would meet again and a down payment of would be forthcoming.  Nice to know that you can pay bribes on the installment plan these days.  Unfortunately, prior to the meeting, the business owners had reported Coombs's actions to the authorities.

On May 19, Coombs accepted $3,000 in payment toward the requested $9,700 bribe. What Coombs didn’t realize was investigators were present to see him receiving the money.

After taking the bribe, Coombs confirmed that he had taken care of things at the IRS. The two men then arranged yet another meeting, scheduled for June 2, for payment of the balance of the bribe.

The Situation Goes Out of Control

On June 2, 2010, after Coombs received the final payment of $6,700, he was arrested.  Coombs was indicted on June 21, 2010, and on August 19, 2010 pleaded guilty.

On December 16, 2010, the United States Attorney’s Office for the District of Minnesota announced that Coombs was sentenced by United States District Court Judge Paul A. Magnuson for one count of soliciting and agreeing to receive a bribe of $9,700. Judge Magnuson sentenced Coombs to 33 months  in federal prison.

All in all, justice was served here.  Still – I’m not totally convinced or happy.

Manicure, Pedicure, and Bribe

As you may recall on November 2, 2009, I wrote a story about a small business owner who was named in a federal case involving IRS corruption charges: Manicurist Hit With IRS Corruption Charges -- Know What I'm Sayin'?  (BrokeAndBroker.com at http://www.brokeandbroker.com/index.php?a=blog&id=617

In that case, we learned that on October 28, 2010, the United States Attorney for the Southern District of New York, announced that Chinh Tran, 41, of West Nyack, New York, had been arrested on charges of making corrupt payments to an Internal Revenue Service ("IRS") revenue agent.

NOTE: The charges contained in the Complaint against Tran are merely accusations, and the defendant is presumed innocent unless and until proven guilty.

According to the federal criminal Complaint, Tran's 2007 Individual Income Tax Return was selected for audit by the IRS. The audit concerned, among other things, the amount of income that Tran, the owner a nail salon in Nanuet, New York, reported from a similar business that she owned in Grapevine, Texas.

During the course of the IRS audit, the Complaint alleges that "Tran offered, and ultimately gave, corrupt payments to an IRS revenue agent, who, unbeknownst to Tran, was working with law enforcement." Specifically, Tran was charged with giving a bottle of liquor and $18,000 in cash to the revenue agent – with the intention that the money was for the revenue agent’s own use – in exchange for having the revenue agent close the pending audit of Tran’s income tax return and issue a letter to Tran indicating that no changes were proposed to Tran’s income tax return as a result of the audit.

Tran appeared in White Plains federal court before U.S. Magistrate Judge Paul E. Davison and was released on a $250,000 personal recognizance bond, co-signed by one financially responsible person. If convicted, Tran faces a maximum of 15 years imprisonment.

Final, Disconcerting Thoughts

Maybe I’m missing something?  Coombs, a federal employee -- an IRS agent no less -- solicits and receives a bribe and is sentenced to less than 3 years in prison.  Tran, a taxpayer, solicits and pays a bribe to a federal employee, and she is facing 15 years in prison.  

This is precisely one of those reasons that I detest many press releases that flow daily from the offices of local, state, and federal prosecutors, as well as a whole host of Wall Street regulators.  On the one hand, these press releases routinely claim that the prosecutions involved are intended to send a message to the public and miscreants.  On the other hand, just exactly what message do we have when you compare Coombs to Tran?

Coombs presents a troubling picture that some government employees may expect to be bribed. The puzzling aspect of Coombs is that we don't know whether there was an honest tax bill of $60,000 and the IRS examiner was willing to shortchange the government by taking a bribe to reduce what was owed -- or whether the game here was that the examiner had juiced up the amount owed and was, in effect, seeking the bribe in order to re-compute the tax debt to a lower (presumably more accurate) number. Either scenario is infuriating.

Of course, you take the facts in Coombs and you have to wonder whether Tran, or other similarly situated taxpayers, are aware of rumors of the culture of corruption.  After all, maybe some of those small business owners who find themselves being audited read the press reports about Coombs. Regardless, maybe a lot of small fry out there are convinced that if you don't pay a few bucks to the IRS guy, that he's going to artificially jack-up your tax bill and by the time you hire a lawyer and fight it, you might have been better off handing over a bottle of Scotch and a few thousand in cash as a bribe.

For me, it's less about whether Coombs was appropriately punished with a 33-month sentence or whether Tran should go away for 15 years.  The larger concern is how you relate all of these disparate facts, justify the differences in sentences (imposed and proposed), and come to some fair understanding of whether the criminal justice system works.

Maybe there's simply no solution or one-size-fits-all answer to these problems.  Then again, maybe simply reporting on these cases adds valuable grist to the mill.


Topics: Coombs  IRS  Bribe  Tran  Bill Singer  BrokeAndBroke.com  
 
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