Five partners at Ernst & Young – Robert Coplan, Martin Nissenbaum, Richard Shapiro, and Brian Vaughn, and Charles Bolton – were charged with a number of tax crimes in federal court in New York, specifically tax evasion, conspiracy to defraud the United States, and lying to the IRS. The Second Circuit said that the government didn’t prove that two of the men were guilty and send the case back.
Ernst & Young had developed a number of tax shelters. Tax shelters – to be clear – are not themselves necessarily legal or illegal. As the jury was instructed, “it depends on the facts.”
There were five tax shelters at issue. The Second Circuit, in United States v. Coplan, described the tax shelter that was the basis of the tax evasion count this way: