Tips for Handling Clients Who Committed Fraud



The world of audits can be overwhelming and, with the looming presence of fraudulent activity, audits can quickly enter nightmare territory. Therefore, it is crucial to enter each situation armed with the knowledge of how to proceed in the interest of protecting yourself and your clients to the best of your ability.

Understanding tax fraud is key to recognizing when a client’s audit is snowballing into a criminal case. The best practices for handling a sensitive audit, as well as an explanation of how the IRS conducts its investigations to determine if fraud has occurred, will be covered in greater detail in an upcoming webinar on Aug. 25, featuring Venar A. Ayar, JD, LL.M., founder of Ayar Law, which specializes in, among other things, audit defense. 

According to Ayar, it is incredibly important to understand the different types of tax fraud and their respective indicators, which the government uses to determine their cases. Gaining familiarity with this provides a better understanding on how to approach each client’s case and how to protect yourself from issues that can arise when representing a client. Issues such as:

  • Conflict of interest issues occur when there is a natural conflict between the CPA who prepared the return, and the client.

  • Privilege issues can be avoided by understanding that no privilege exists to protect conversations related to preparation of a tax return.

  • Ethical issues arise when the appropriate steps are not taken to abide by ethics rules and statutes, which could lead to disbarment and/or criminal charges.

A strong, basic knowledge of tax fraud and tax fraud best practices, ensures you can confidently approach your clients armed with the necessary knowledge to navigate their situation and to know when it is time to bring in an expert tax lawyer for proper legal aid.

Take your knowledge further on this important issue by reserving your place for the upcoming webinar, What you need to know if your client is being audited and you think they committed fraud, online-live on Thursday, Aug. 25, from 10 a.m. – 11 a.m. EST. Available now on the MICPA Store.

Source: Ayar Law

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