January 21, 2010 / 5:36 PM / 10 years ago

E&Y partner gets prison over tax shelter scheme

 * Coplan sentenced to 3 years prison, $75,000 fine
 * Nissenbaum to be sentenced later Thursday
 * $2 billion tax loss resulted from scheme
 By Jonathan Stempel
 NEW YORK, Jan 21 (Reuters) - A former partner at the Ernst
& Young LLP [ERNY.UL] accounting firm was sentenced on Thursday
to three years in prison for his role in a $2 billion scheme to
create shelters to help wealthy people evade income taxes.
 Robert Coplan, the partner, was also fined $75,000 and
ordered to perform 120 hours of community service annually for
three years by U.S. District Judge Sidney Stein in Manhattan
federal court. At least half the service is to counsel tax
professionals about his experiences and avoiding wrongdoing.
 Coplan's lawyer, Paula Junghans, said she plans an appeal.
 Coplan was among four current and former Ernst & Young
partners convicted by a Manhattan federal jury last May on tax
evasion and conspiracy charges after a two-month trial.
 A second defendant, Martin Nissenbaum, is scheduled to be
sentenced Thursday afternoon. The other defendants, Richard
Shapiro and Brian Vaughn, are to be sentenced on Friday. Stein
said he intends to impose prison terms on each.
 Coplan and Nissenbaum were also convicted of obstructing
the Internal Revenue Service, while Coplan and Vaughn were also
convicted of making false statements to the IRS.
 None of the defendants is still employed by Ernst & Young,
company spokesman Charles Perkins said.
 Prosecutors accused the defendants of defrauding the IRS
from 1998 to 2006 by creating, marketing and using shelters to
help people with more than $10 million of taxable income to
reduce or avoid income taxes.
 Saying the experience has "ruined me and ruined my family,"
Coplan apologized for his actions. "I have deep regret that I
made mistakes 10 years ago," he told the judge. "I'm constantly
reminded of the pain I've brought to my family."
 While Stein said Coplan had otherwise led an "admirable
life," he said "general deterrence" was the major reason for
imposing the sentence.
 "I understand there was pressure coming from higher-ups at
Ernst & Young" to add business, he said. Stein nevertheless
said "there's really very little doubt that the loss is in the
range of $2 billion," and that the conduct was "very serious."
 Perkins declined to comment on Stein's assessment.
 Coplan was once national director of Ernst & Young's center
for wealth planning, and an IRS branch chief. Nissenbaum was
once national director of Ernst & Young's personal income tax
and retirement planning practice.
 Coplan is 57 and resides in Plano, Texas, while Nissenbaum
is 54 and resides in Brooklyn, New York, the government said.
 The case is U.S. v. Coplan et al, U.S. District Court,
Southern District of New York, No. 07-cr-00453.
 (Reporting by Jonathan Stempel, editing by Matthew Lewis)

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