• Register
Return to: Home > News > Tax > Former BDO partner pleads guilty

Former BDO partner pleads guilty

A former BDO Seidman partner faces up to 10 years in jail after pleading guilty to conspiracy to defraud the US tax system and helping investors avoid paying $200 million in tax through a tax shelter scheme.



Michael Kerekes pleaded guilty to one count of conspiracy to defraud the US Inland Revenue Service (IRS) and one count of tax evasion at the Southern District of New York in Manhattan, according to the US Department of Justice.

Between 1998 and 2008, Kerekes was an attorney and a principal at BDO Seidman and from 1998 until 2003 he was a member of the firm’s tax solutions group (TSG). The group designed and implemented high-fee tax strategies, including shelters, for wealthy clients.

Kerekes and his co-workers caused the clients to file false and fraudulent tax returns reporting the tax benefits flowing from the shelter transactions, the US Department of Justice said.

In total, the fraudulent tax shelter transactions implemented by Kerekes, his accounting firm, a law firm Jenkens & Gilchrist, and the financial institution that assisted them, caused clients to report more than $1 billion in false and fraudulent tax losses. This resulted in the evasion of more than $200 million of taxes due to the IRS.

BDO Seidman said in a statement the TSG was dissolved by the firm several years ago.

“BDO Seidman has co-operated fully with the government’s investigation and will continue to do so. The firm does not intend to comment further,” the statement said.

Kerekes faces five years prison for conspiracy and five years prison for tax evasion. He is due to be sentenced on 4 March 2010.

Top Content

    Time pressure: Facing up to mental health

    In an ‘always on’ culture, it is becoming increasingly difficult to manage a healthy work-life balance. While companies are beginning to address this problem by introducing different support systems, Joe Pickard finds more could be done to ensure the wellbeing of the professions workforce.

    read more

    Venezuela: the race for the dollar

    With a new currency following hyperinflation, large sections of the population emigrating to neighbouring countries, an economy on the brink of collapse and no apparent solution coming from the government, Jonathan Minter finds a profession struggling to stay afloat in Venezuela.

    read more

    Brazil: transparency and control

    Brazilian accountants have an optimistic view of the impact of more-regular reporting and the implications of audit controversies for the profession. Paul Golden reports.

    read more

    Argentina: looking for a clearer view

    The Argentine accounting profession continues to grapple with the impacts of a weak economy and a culture of financial corruption. Paul Golden takes a closer look.

    read more

    Blockchain: adapting to disruptive tech

    In the relatively few years since digital currencies first began using blockchain technology, the array of potential applications has grown significantly – and continues to expand. Dan Balla, Matthew Schell and Dave Uhryniak from Crowe look at how it impacts accountancy.

    read more
Privacy Policy

We have updated our privacy policy. In the latest update it explains what cookies are and how we use them on our site. To learn more about cookies and their benefits, please view our privacy policy. Please be aware that parts of this site will not function correctly if you disable cookies. By continuing to use this site, you consent to our use of cookies in accordance with our privacy policy unless you have disabled them.