Source: http://federaltaxcrimes.blogspot.com/2018/05/special-counsel-opposes-motion-to.html
Timestamp: 2019-02-23 10:34:13
Document Index: 23187677

Matched Legal Cases: ['§ 3292', '§ 3290', '§ 6531', '§ 3290', '§ 3290', '§ 6531', '§ 3290', '§ 3287', '§ 3292']

Federal Tax Crimes: Special Counsel Opposes Motion to Dismiss FBAR Count as Untimely Because of Secret 18 USC 3292 Order (5/15/18)
For other Federal Tax Crimes blogs on this issue
Suspension of Criminal Statute of Limitations Upon Request to a Foreign Government for Information (Federal Tax Crimes Blog 11/14/13), here.
Eleventh Circuit Sustains Statute Suspension For Foreign Records Request Under 18 USC 3292 (Federal Tax Crimes Blog 8/17/12), here.
Court holds Application to Court for 18 USC 3292 Foreign Treaty Request Suspension Must be Made Within Statute of Limitations (Federal Tax Crimes Blog 2/11/12), here.
Suspension of Statute of Limitations Period During Request for Foreign Assistance to Obtain Evidence (1/28/11), here.
1. The docket entries as of today are here. I found no indication that the court has acted on the motion. Based on my reading of the prosecutors' response, it is likely to be denied.
2. This case illustrates that the putative target of an investigation may not be able to predict when the statute of limitations actually runs. Manafort and his counsel did not know of the order which was sealed until disclosed in the Government's response.
3. One thing we don't know is whether there might be some unified grand jury proceeding to look at the information DOJ Tax and the IRS is getting about foreign bank accounts (e.g., from the DOJ Swiss Bank Initiative) and whether any 3292 orders have been obtained. There might be some really interesting issues presented if such orders have been obtained, such as when final action occurs (individual by individual, or for the final individual in the or a group, etc.).
4. There are other events that might trigger a suspension of the statute of limitations. The following is from my now discontinued Federal Tax Crimes book, but is probably still pretty good on the general issues (footnotes omitted; note that I do not indent the following):
Several events can suspend the running of the statute of limitations for tax crimes. Note the following:
• The civil and criminal statutes of limitations are suspended: (i) if the taxpayer brings or participates in a proceeding to quash the summons, the statute is suspended during the period the proceeding is pending; or (ii) if the third party summonsee, including a John Doe summonsee, fails to respond properly, the statute is suspended during the period beginning on the date six-months after the summons is issued and ending on the date of “final resolution of such response.”
• The statute of limitations is suspended during a so-called Due Process Proceeding when there are limitations upon the IRS’s ability to investigate or collect.
• 18 U.S.C. § 3292 may permit the Government unilaterally to toll the statute of limitations by making an official request for foreign records relevant to the crimes being investigated by a grand jury. I discuss this below.
• Fugitive. Section 3290 defines fugitive as “any person fleeing from justice.” The “majority rule” is that “intent to avoid arrest or prosecution must be proved” for § 3290's fugitive definition to apply; the minority rule is that mere absence from the jurisdiction, regardless of intent, is sufficient. As noted, of course, the disjunctive provision in § 6531 tolls the statute upon mere absence from the country regardless of fugitive status under § 3290. I am not aware of a case that discusses whether § 3290 applies to crimes outside Title 18 (other than instances such as § 6531 which expressly imports it for Title 26 crimes). For example, I am aware of no case that says that § 3290 applies for FBAR crimes. However I found one case where it did apply to a non-Title 18 crime (an immigration crime), so I presume that it does apply to non-Title 18 crimes, but readers should confirm that if it is important.
• The statute is tolled while an indictment is under seal.
• For tax crimes, the statute is effectively tolled for 9 months by the Government filing a complaint. This device is a limited one to be used in exigent circumstances, and not as a general way to extend the statute in all cases.
• If a timely indictment is dismissed after expiration of the statute of limitations for a reason other that one that bars later prosecution, a new indictment or information may be brought within six months of the dismissal.
One problem of uncertain scope is the Wartime Suspension of Limitations Act ("WSLA"), 18 U.S.C. § 3287. The statute provides in relevant part:
(1) involving fraud or attempted fraud against the United States or any agency thereof in any manner, whether by conspiracy or not,
shall be suspended until 5 years after the termination of hostilities as proclaimed by a Presidential proclamation, with notice to Congress, or by a concurrent resolution of Congress.
Subsection (1) is worded very broadly and is not limited to fraud that relates to any hostility authorized by declaration of war or congressional resolution. Specifically, the Iraqi and Afghanistan engagements have been authorized but have not been terminated in the form textually prescribed the by statute. Does that mean that all frauds – including tax fraud crimes – now have their statutes of limitations suspended?
b. Foreign Country Evidence.
In a world where international commerce, often of the illegal sort and often assisting tax fraud, is increasing exponentially, key evidence may be overseas. Because long delays may be encountered in gathering foreign evidence, 18 U.S.C. § 3292 in some cases permits the statute of limitations to be suspended during the period between the U.S. request for foreign evidence and the production of that evidence by the foreign authority. The key elements for this tolling are:
• Incident to the investigation, a request for information must be made to a foreign jurisdiction before the return of an indictment. The request must be an official request, defined as “a letter rogatory, a request under a treaty or convention, or any other request for evidence made by a court of the United States or an authority of the United States having criminal law enforcement responsibility, to a court or other authority of a foreign country.” I cover below in the text various of these methods for making a request to a foreign country. In the tax context, perhaps the principal form of the request would be under the double tax treaty, which was one of the devices used in the UBS grand jury investigation to flush out information about UBS depositors. Effectively, what I call a “John Doe” request was submitted to the Swiss tax administrators for information and documents related to U.S. taxpayers meeting certain criteria.
• The Government must apply to the district court. There is conflict in the circuits as to whether this application must be filed before the normal statute of limitations expires.
• There is conflict among the circuits as to whether the application to the district court must be filed before the foreign authority’s final action on the request.
Posted by Jack Townsend at 7:23 PM