John Bullis: IRS agent illegally ran her own tax-service company

Of more than 90,000 IRS employees, there are bound to be a few “bad apples” who act wrongfully. Most IRS employees are hardworking, dedicated, intelligent and professional folks who do a lot of good work under very difficult circumstances.

The FBI and the treasury inspector general for tax administration (TIGTA) investigated and the U.S. Attorney’s Office prosecuted Jeanne L. Gavin recently.

Ms. Gavin worked for IRS 34 years, but she operated her own tax-service business at the same time. She supervised about 10 agents in the Baton Rouge, La., IRS office. She defrauded her subordinates by leading them to believe they were accessing tax records for official IRS business, but it was really for work on 70 of her own clients.

She admitted she received more than $70,000 from her business, Too Cool Enterprises, LLC.

Chief U.S. District Court Judge Brian A. Jackson sentenced her to a year in prison followed by three months in a halfway house and nine months of post-custody supervision for her unauthorized use of an IRS database.

The judge said Gavin knew she was not allowed to operate a private tax service while working for the IRS, and she concealed her business from her superiors.

Judge Jackson compared Gavin’s actions to those of other criminal defendants who appear in his courtroom, saying, “some people think they are smarter than anyone else. They think they can get away with anything.” He added, “I think you have compromised the public’s trust in the IRS.”

The two counts to which she pleaded guilty are misdemeanors — conflict of interest and exceeding authorized access to a government computer.

This is just another time it really is best to have a good attorney. Under IRS circular 230, she might have been fined up to $250,000 instead of the $20,000 she will have to pay.

It is important to remember whatever wrong is done by the bad apples is an individual thing for which they are entirely responsible. There is no conspiracy in the IRS operations that goes from the top to the bottom of the organization. Most IRS employees we deal with are good people in a difficult job.

The occasional bad apple does tend to confirm the need to be alert. Her supervisors, subordinates and clients might have realized something was going on.

Did you hear? “The only person who gets anywhere playing both ends against the middle is an accordion player.”

John Bullis is a certified public accountant, personal financial specialist and certified senior adviser who has served Carson City for 45 years. He is founder emeritus of Bullis and Co. CPAs.