Sometimes, the IRS Makes Whistleblowers Millionaires

For most people, the IRS is a nuisance. But for whistleblowers, the agency can be a kingmaker.

In what is likely to be the largest whistleblower award in the Internal Revenue Service's history, the agency may pay a former executive for Caterpillar (CAT) hundreds of millions of dollars for reporting on a shady tax strategy he witnessed.

Though the IRS has been allowed to award whistleblowers since 1867, Congress passed a law in 2006 that dramatically changed the whistleblowing program. Under the 2006 law, if a whistleblower's report leads to a collection of more than $2 million, the whistleblower is entitled to 15% to 30% of the total amount collected. read more »

Supreme Court limits SEC's power to recover ill-gotten gains

The U.S. Supreme Court on Monday scaled back the Securities and Exchange Commission's power to recover ill-gotten profits from defendants' misconduct, handing Wall Street firms a victory and dealing another blow to the regulator's enforcement powers.

In a 9-0 ruling, the Supreme Court found that the SEC's recovery remedy known as "disgorgement" is subject to a five-year statute of limitations. The justices sided with New Mexico-based investment adviser Charles Kokesh, who previously was ordered by a judge to pay $2.4 million in penalties plus $34.9 million in disgorgement of illegal profits after the SEC sued him. read more »

The RBS crisis: a timeline of events

From the bank’s ill-fated 2007 takeover of ABN Amro to the exit of Fred Goodwin and shareholders’ £520m lawsuit. read more »

Challenges to Insider Trading Convictions Take Aim at Evidence

We are used to watching television programs about cases being solved by DNA evidence, a fingerprint or even a timely confession.

White-collar crime is often quite different, resembling more a thousand-piece puzzle than a whodunit as prosecutors try to put together tidbits of information that can add up to a conviction.

Still, a single piece of evidence can play a crucial role in the outcome by rounding out a picture of the defendant’s knowledge of the wrongdoing, a crucial factor in a trial. Two challenges to insider trading convictions highlight how important that evidence can be as the defendants seek to pull out a single thread to unravel an entire prosecution. read more »

Texas company settles kickback claims for prison contracts

A Texas-based company has agreed to pay the U.S. government almost $2.5 million to settle allegations that it obtained inside information to gain an advantage in bidding for federal prison contracts.

The Justice Department announced the settlement Monday with Integrated Medical Solutions Inc. and its former president, Jerry Heftler.

The settlement resolves accusations that IMS violated the False Claims Act and Anti-Kickback Act by paying Cary Hudson, a former business administrator with the U.S. Bureau of Prisons, to serve as a consultant in return for confidential information that gave the company an unfair advantage in the bidding process. read more »