# Department of the Treasury (2010)

> Briefs, arguments, decisions, and more.

URL: https://www.frixlaw.com/law-library/documents/agency%3Airs%3Ae09b98520cd63e17

## Record

- **Collection:** Agency decision
- **Document type:** Agency decision

## Text

United States
Department of the Treasury

Director, Office of Professional Responsibility,
Complainant-Appellant
v.

Complaint No. 2010-19

(b)(3)/26 USC 6103

,
Respondent-Appellee

Decision on Appeal
Authority
Under the authority of General Counsel Order No. 9 (January 19, 2001) and a
delegation order dated March 2, 2011, I have been delegated the authority to decide
disciplinary appeals to the Secretary of the Treasury filed under Part 10 of Title 31,
Code of Federal Regulations (Practice Before the Internal Revenue Service (IRS),
reprinted by the Treasury Department and hereinafter referred to as Circular 230 - all
references are to Circular 230 as in effect for the period(s) at issue). This is such an
appeal from a Decision and Order on Default (Default Order) entered into this
proceeding by Chief Administrative Law Judge Susan L. Biro (the ALJ) on February 4,
2011.
Procedural History
This proceeding was commenced on November 10, 2010, when the ComplainantAppellant, Director of the Office of Professional Responsibility (OPR) filed a Complaint
USC
against Respondent-Appellee, (b)(3)/26 USC 6103 (“ (b)(3)/26
”). The Complaint
6103
(b)(3)/26 USC
alleges that
has
engaged
in
practice
before
the
IRS,
as defined by§10.2, as
6103
(b)(3)/26
USC
6103
a certified public accountant, and further, that
and that

(b)(3)/26 USC 6103

2
(b)(3)/26 USC 6103

:
(b)(3)/26
USC 6103

(b)(3)/26
USC 6103

SAME

(b)(3)/26 USC 6103

(b)(3)/26 USC 6103

(b)(3)/26 USC 6103

(b)(3)/26
USC 6103

1

SAME
SAME
SAME
SAME
SAME
SAME

(count 1)
(count 2)
(count 3)
(count 4)
(count 5)
(count 6)
(count 7)

For counts 1-3,
states that

(b)(3)/26 USC 6103

(b)(3)/26 USC 6103

(b)(3)/26 USC 6103

(b)(3)/26 USC 6103

(b)(3)/26 USC 6103

(b)(3)/26 USC 6103

(b)(3)/26 USC 6103

(b)(3)/26 USC 6103

(b)(3)/26 USC 6103

(b)(3)/26 USC 6103

(b)(3)/26 USC 6103

(b)(3)/26 USC 6103

(b)(3)/26 USC 6103

(b)(3)/26 USC 6103

(b)(3)/26 USC 6103

(b)(3)/26 USC 6103

(b)(3)/26 USC 6103

(b)(3)/26 USC 6103

(b)(3)/26 USC 6103

(b)(3)/26 USC 6103

(b)(3)/26 USC 6103
(b)(3)/26 USC 6103

(b)(3)/26 USC
6103
(b)(3)/26 USC
6103
(b)(3)/26 USC
6103
(b)(3)/26 USC
6103

. For counts 1-4, the Complaint
. (b)(3)/26 USC
6103

.
The Complaint contains three additional counts. Count 8 of the Complaint alleges that
USC
(b)(3)/26 USC 6103
on about April 30, 2007, OPR wrote (b)(3)/26
alleging that
6103
, giving him 30 days to respond. The Complaint states that his failure to respond
(b)(3)/26 USC 6103
constitutes a willful violation of§10.20(b) of
Circular 230, which requires practitioners to provide responsive information concerning
OPR inquiries.2 Count 9 of the Complaint alleges that on about August 30, 2009, OPR
USC
(b)(3)/26 USC 6103
again wrote (b)(3)/26
this time alleging that
6103
, giving him 30 days to respond. The Complaint states that his failure to respond
(b)(3)/26 USC 6103
constitutes a willful violation of§10.20(b) of
Circular 230. Count 10 of the Complaint alleges that on about January 5, 2010, OPR
USC
(b)(3)/26 USC 6103
again wrote (b)(3)/26
concerning
,
6103
giving him 20 days to respond. The Complaint states that his failure to respond
(b)(3)/26 USC 6103
constitutes a violation of§10.20(b) of Circular 230.
The Complaint states that with respect to

(b)(3)/26 USC 6103

10.51 of
Circular 230 for which (b)(3)/26 USC 6103 may be censured, suspended, or disbarred from
practice before the IRS. The Complaint states that with respect to counts 8-10 that the
1

(b)(3)/26 USC 6103

, which have
no bearing on the result herein.
2
USC
The file indicates that OPR sent (b)(3)/26
a letter about (b)(3)/26 USC 6103 dated February 7, 2007,
6103
informing him that if he did not respond within 30 days that OPR would initiate a disciplinary proceeding
USC
against him under Circular 230. I did not see anything in the file indicating that (b)(3)/26
responded to
6103
any of OPR’s correspondence nor did he answer the November 10, 2010 Complaint in this case or
participate in any way in this proceeding.

3
(b)(3)/26 USC 6103
failure to respond
was a willful
(b)(3)/26 USC
violation of§10.20(b) for which
may be censured, suspended, or disbarred
6103
from practice before the IRS.
USC
The Complaint requests that (b)(3)/26
be disbarred from practice before the IRS
6103
pursuant to§
§10.20, 10.50, 10.51, 10.52 and 10.70 of Circular 230.
(b)(3)/26 USC
6103

did not file an Answer to the Complaint and on December 20, 2010, OPR
USC
served on
a motion for default to which (b)(3)/26
[sic] did not respond. In
6103
(b)(3)/26 USC 6103
entering the Default Order, the ALJ found that (i) the counts for
are barred by the statute of limitations contained in 28 U.S.C.§2462 (b)(3)/26 USC 6103
(b)(3)/26 USC 6103
, (ii)
, and
(b)(3)/26 USC 6103
(b)(3)/26 USC 6103
, (iii) the part of the count for
(b)(3)/26 USC 6103
was invalid because the Complaint did not allege
and there is no support for that finding in the record, and
USC
(iv) the three counts alleging (b)(3)/26
’s willful failure to respond to OPR in violation of
6103
§10.20 of Circular 230 were sustained. As to the sanction, the ALJ held that since the
(b)(3)/26 USC
counts for 6103
were not sustained, nor was the part of the count for (b)(3)/26 USC 6103
, that a sanction of indefinite suspension was commensurate with the
seriousness of the disreputable conduct that was found. Default Order at p. 10.
(b)(3)/26 USC
6103

OPR filed an appeal asserting that the Decision and Order was in error as (i) OPR
USC
(b)(3)/26 USC 6103
properly charged (b)(3)/26
with
, and that his failure to answer
6103
(b)(3)/
the Complaint constituted an admission of same, (ii)§2462 does not apply to
26 USC 6103
in OPR practitioner proceedings as the proposed discipline is remedial,
USC
and (iii) the sanction should be modified to disbar (b)(3)/26
rather than subject him to
6103
an indefinite suspension. On July 20, 2011, I issued an Order asking OPR to address
(b)(3)/26 USC 6103
two issues: why it took OPR so long from the time it identified
(b)(3)/26 USC 6103
[sic] to file the Complaint, and whether if§2462 bars counts for
the
underlying conduct could be considered for any purpose. OPR responded but
(b)(3)/26
USC 6103 did not respond to OPR’s brief in support of its appeal or its supplemental brief.
Findings of Fact
The Appellate Authority reviews the ALJ’s findings of fact under a clearly erroneous
standard of review. Section 10.78 of Circular 230. The ALJ’s findings of fact are well
supported by the record and are not clearly erroneous. However, because of the ALJ’s
conclusion that the statute of limitations barred the bringing of counts (b)(3)/26 USC 6103 ,
(b)(3)/26 USC 6103
she did not make a finding as to whether
. The record
(b)(3)/26 USC 6103
provides clear and convincing evidence that
As
these facts were pled by OPR and not denied by (b)(3)/26 USC 6103 , they are deemed
admitted. The record also provides clear and convincing evidence that
(b)(3)/26 USC 6103
. As this fact was
(b)(3)/26 USC
pled by OPR and not denied by
, it is deemed admitted.
6103

4

Analysis
The Appellate Authority reviews the ALJ’s findings as to issues that are exclusively
matters of law de novo. Section 10.78 of Circular 230. The application of§2462 is
exclusively a matter of law.
USC
In OPR v. (b)(3)/26
, Complaint No. 2010-09 (Decision on Appeal, May 26, 2011), I
6103
held that (i)§2462 was applicable to OPR disciplinary proceedings with regard to a
(b)(3)/26 USC 6103
count, (ii) the date that the§2462 limitations period commences
(b)(3)/26 USC 6103
running is
, and (iii) (b)(3)/26 USC 6103
(b)(3)/26 USC 6103
was not a continuing violation. In OPR v.
, Complaint No. 2010-12
(Decision on Appeal, October 12, 2011), I held that§2462 was applicable to OPR
(b)(3)/26 USC 6103
disciplinary proceedings with regard to a
(b)(3)/26 USC 6103
count. I also held that ordinarily
is the date that should be used to start the running of the statute of limitations and that
(b)(3)/26 USC 6103 violation is not a continuing one with an exception not applicable here.
USC
The holdings in (b)(3)/26
and SAME are not particular to their facts; I have not as of yet
6103
seen any circumstances whereby OPR will be able to describe proposed discipline so
that it will be characterized as remedial rather than penal for purposes of§2462. I affirm
USC
the ALJ’s finding that the counts (b)(3)/26
are not sustained.
6103

The application of§2462 has arisen in many of the cases coming to me on appeal since
the issue was first identified by Chief Judge Biro sua sponte. The reason that§2462
frequently arises is that OPR often does not file a Complaint until long after it initially
(b)(3)/26 USC 6103
identifies
violation so that in each case to which§2462 applies,
violations
are
more
than five years old.
(b)(3)/26 USC 6103
OPR sent (b)(3)/26 USC 6103 a letter dated February, 8, 2007, asserting that (b)(3)/26 USC 6103
and stating that it would not take action
(b)(3)/26 USC
USC
for 30 days during which
could submit a response, but that if (b)(3)/26
did
6103
6103
not respond OPR would initiate a disciplinary proceeding under Circular 230. OPR sent
(b)(3)/26 USC
similar letters dated April 13, 2007; September 30, 2009; and January 5,
6103
(b)(3)/26
(b)(3)/26 USC 6103
2010.
, but (b)(3)/26 USC 6103
USC 6103 apparently
through the commencement of this proceeding, nor did he ever
respond to the OPR correspondence. The Complaint was filed November 10, 2010.
In response to my question as to why OPR waited so long after it had identified
(b)(3)/26 USC 6103
to file the Complaint in this case, OPR explained that it waited an
appropriate length of time under all the circumstances because its focus is to assure
that practitioners are fit to practice.
I find it inexplicable that OPR waited well over three and a half years after identifying
(b)(3)/26 USC 6103
[sic] to conclude that he was not a suitable person to practice
(b)(3)/26 USC 6103
before the IRS. This is particularly so given that with
, even after
(b)(3)/26
USC
6103
having been flagged by OPR,
,

5
and failed to respond to OPR’s repeated threats to bring a disciplinary action against him (b)(3)/26
he did not even attempt to set out mitigating circumstances. As I stated in USC 6103 , I find
that Johnson v. Securities and Exchange Commission, 87 F.3d 484, 488-90 (D.C. Cir.
1996), and the authorities cited therein are a controlling precedent, and thus§ 2462
(b)(3)/26 USC 6103
commences as to
(b)(3)/26 USC 6103
and commences as to
(b)(3)/26
as described in USC 6103 . OPR may continue to delay the
initiation of proceedings for extended periods, but one cost of its doing so is that it will be
unable to present counts (b)(3)/26 USC 6103 .
OPR also appeals the ALJ’s disallowance of
states that“ [r]espondent

(b)(3)/26 USC 6103

. Count 4

(b)(3)/26 USC 6103

and that

(b)(3)/26 USC 6103

of Circular 230. The
(b)(3)/26 USC 6103

ALJ held this allegation was not sufficient to allege
and further, that the record did not support such a
finding (Default Order at p. 8). OPR asserts that under§10.62(a) of Circular 230 its
USC
(b)(3)/26 USC 6103
pleading provided (b)(3)/26
with fair notice of a charge of
and
6103
that the record provided support for same. I find it unnecessary to address this issue for
two reasons. First, since several valid counts have been sustained in this case the
number of counts sustained is not of import and a Circular 230 proceeding that has found
a violation warranting discipline may consider (b)(3)/26 USC 6103 in determining the
(b)(3)/26 USC 6103
sanction whether or not it is part of a count or whether
. Second, as described below, I have concluded
that the appropriate sanction is disbarment without regard to sustaining this element of
(b)(3)/26 USC 6103 , so a decision on this issue is unnecessary. However, if would certainly
be prudent for OPR to consider the points made by the ALJ in framing future complaints
and proving up same in default motions.
Appropriate Sanction
The Appellate Authority reviews the sanction sought by OPR and imposed by the ALJ de
(b)(3)/26
novo. See, e.g., Director, OPR v. USC
6103 , Complaint No. 2007-12 (April 21, 2009) at p.
USC
3; Director of OPR v. (b)(3)/26
,
Complaint
No. 2006-23 (April 2008) at p. 3; Director, OPR
6103
(b)(3)/26 USC
(b)(3)/26
v.
, Complaint No. 2007-08 (July 2008) at p. 4; Director, OPR v. USC
6103
6103 ,
(b)(3)/26
Complaint No. 2008-12 (January 20, 2010) at p. 6; Director, OPR v. USC
,
Complaint
6103
No. 2008-19 (May 26, 2009) at p. 4. I modify the suspension imposed by the ALJ for the
reasons stated below.
(b)(3)/26 USC 6103
The Complaint requests a sanction of disbarment, based on
,
(b)(3)/26
USC
6103
and
, but, as stated
(b)(3)/26 USC 6103
above, because of §2462, only the violations
(b)(3)/26 USC
and for
failure to respond to OPR in violation of§10.20 of Circular
6103
230 were found to be a basis for liability by the ALJ. Because fewer counts than
proposed were sustained, the Default Order imposes a different sanction - it provides for
an indefinite suspension which allows OPR "sole discretion”to determine when

6
(b)(3)/26 USC
6103

may be reinstated. Default Order at p. 10. OPR has appealed the indefinite
suspension and asks for a sanction of disbarment.

Initially, a practitioner whose sanction is initiated through a disciplinary proceeding, as
provided for in §10.60 et seq. of Circular 230, that is not resolved between the
practitioner and OPR consensually as provided for in §10.61 of Circular 230, should
have his case resolved by the ALJ as provided for in §10.76 of Circular 230, or by the
agency on appeal as provided for in §10.78 of Circular 230. The purpose of the
disciplinary proceeding is to have the sanction determined by the ALJ or the agency,
not by OPR. Section 10.82 of Circular 230 provides for an expedited suspension for a
duration within the control of OPR, but that section applies only under narrow and
specifically defined circumstances and is an interim measure that provides the
practitioner with the ability to obtain prompt resolution with a sanction determined by the
ALJ or agency as described above in a proceeding administered per§10.60 of Circular
230. I conclude that practitioners and OPR are entitled to a determinate sanction by
the ALJ under §10.76 of Circular 230 the application of which may be readily and
unambiguously understood and complied with by the practitioner and OPR, subject to
any specific conditions as provided in §10.79(d) of Circular 230.
(b)(3)/26 USC 6103

after he was contacted by OPR. As of the
(b)(3)/26 USC 6103
date of the institution of this proceeding,
USC
. Further, (b)(3)/26
has not responded to
6103
(b)(3)/26
USC
6103
OPR’s several attempts
or to offer an explanation for
(b)(3)/26 USC 6103 , in violation of§10.20(b) of Circular 230. (b)(3)/26 USC did not answer the
6103
Complaint in this case or otherwise participate in this proceeding. Under these
USC
circumstances, it is clear that (b)(3)/26
is not fit to practice before the IRS and I find
6103
that the appropriate sanction is disbarment.
In light of my conclusion above, it is unnecessary to reach the issue of the
(b)(3)/26
consideration, if any, to be given USC
barred by§2462. However, since I addressed
6103
(b)(3)/26
this issue in USC 6103 and asked OPR to brief the issue in this case, I thought it worth
clarifying that I have concluded that the same principle applies here. Specifically, I
USC
asked OPR whether assuming arguendo that I found that§2462 barred (b)(3)/26
6103
(b)(3)/26 USC
counts,
should be considered in determining the sanction to be
6103
imposed. OPR responded that it would be inappropriate “to consider past bad acts that
can no longer be charged directly in the complaint” but did not provide any authority for
(b)(3)/26
its position. OPR did state that time-barred USC 6103 may be examined to show the
(b)(3)/26 USC 6103
presence of
.
In several previous cases I deferred to OPR as to this position, but I declined to do so in
(b)(3)/26
and would have considered barred USC 6103 as an aggravating factor for sanction
purposes here had it been necessary. The record contains clear and convincing
(b)(3)/26 USC 6103
evidence as to
.
(b)(3)/26
USC
6103
Considering a practitioner’s
immediately before
those covered by timely counts is consistent with the law and regulations and helpful in
determining an appropriate sanction as to a practitioner’s fitness to practice.

(b)(3)/26
USC 6103

7
Specifically, Circular 230 provides that in determining sanctions, “[t]he sanctions
imposed by this section shall take into account all relevant facts and circumstances.”
See §10.50(d). It also provides that the rules of evidence prevailing in courts of law and
equity are not controlling, but that evidence that is irrelevant, immaterial, or wholly
repetitious may be excluded. See§10.73. OPR has sustained violations of Circular 230
USC
(b)(3)/26 USC 6103
for (b)(3)/26
that were timely brought.
6103
, even though barred as separate counts, constitute anterior events that may be
properly considered to shed light on the violations that were sustained. See Local
Lodge No. 1424 v. NLRB, 362 U.S. 411, 416-17 (1960); H. P. Lambert Co., Inc., v.
Secretary of the Treasury, 354 F.2d 819, 822 (1st Cir. 1965); Article II Gun Shop, Inc. v.
Gonzales, 441 F.3d 492, 496-97 (7th Cir. 2006), cert. denied, 2006 U.S. Lexis 8059
(b)(3)/26 USC 6103
(2006).
are relevant facts and circumstances in determining a sanction, and I do not see
any impediments to the consideration of them as aggravating factors in imposing a
sanction. I will consider anterior and posterior events in future cases if included in the
record and substantiated with clear and convincing evidence.
USC
I have considered all of the arguments made by OPR and (b)(3)/26
and to the extent
6103
not mentioned herein, I find them to be irrelevant or without merit.

Conclusion
For the reasons stated, I hereby determine that (b)(3)/26 USC 6103
is disbarred from
practice before the IRS. This constitutes FINAL AGENCY ACTION in this proceeding.

___________________________
Bernard H. Weberman
Appellate Authority
Office of Chief Counsel
Internal Revenue Service
(As Authorized Delegate of the
Secretary of the Treasury)
October 14, 2011
Lanham, MD

CERTIFICATE OF SERVICE
I hereby certify that the Decision on Appeal dated October 14, 2011 in Complaint No.
2010-19 was sent this day by UPS Next Day Air and by First Class U.S. Mail to the
addresses listed below:
UPS Next Day Air:
(b)(3)/26 USC 6103

Redacted
Redacted
(b)(3)/26 USC 6103

First Class U.S. Mail:
Honorable Susan L. Biro
Chief Administrative Law Judge
U.S. Environmental Protection Agency
Office of Administrative Law Judges
Redacted
Redacted
Washington, D.C. 20460
Karen L. Hawkins
Director, Office of Professional Responsibility
Internal Revenue Service
Redacted
Washington, DC 20224
Colleen A. Crane, Attorney
Internal Revenue Service
Office of Chief Counsel, General Legal Services
Redacted
Washington, DC 20224

_____________________________________________
Bernard H. Weberman
Appellate Authority
Office of Chief Counsel
Internal Revenue Service
(As Authorized Delegate of the
Secretary of the Treasury)
October 14, 2011
Lanham, MD

---

Source: Frix Law Library, https://www.frixlaw.com/law-library/documents/agency%3Airs%3Ae09b98520cd63e17. Public record. Not legal advice.