We Could Soon Know the Results (If Any) of the Feds’ Raid of Alliantgroup

Posted on by Jason Bramwell
swat team, black helicopter, blue sky

It has been more than three weeks since IRS Criminal Investigation conducted a court-ordered raid of Alliantgroup’s offices in Houston. Since then we still haven’t learned exactly why the IRS paid a visit to the tax consulting firm’s Houston headquarters. No arrests were made that day. But we might know by the end of the month if investigators dug up some interesting dirt on Alliantgroup.

We have been unable to confirm this so far, but rumor has it a grand jury hearing will be held at the federal courthouse in downtown Houston on June 23 related to the raid. A source who works at Alliantgroup and wished to remain anonymous told us that multiple Alliantgroup clients received subpoenas asking for their testimony.

We were told that the grand jury hearing will determine whether the evidence the IRS has on any possible wrongdoing by Alliantgroup merits criminal charges being filed. The source said what those charges could be is anyone’s guess at this point. And if the hearing doesn’t go as planned for the government, we may never find out why the raid was conducted. But it the hearing does go well for the government, our source said, “We’ll all find out if charges will be filed that day or very soon after.”

There has been speculation that the raid was connected to a lawsuit filed against Alliantgroup in 2019 regarding 179D tax deductions. But our source shot that down, saying that particular lawsuit was resolved.

That’s all we know at this point. If anyone can shed any more light on this possible grand jury hearing next week, get in touch with us using the contact info below. All tipsters will be kept anonymous.

Related articles:

The IRS Is Paying an Unwelcome Visit to Alliantgroup
Former and Current Alliantgroup Employees Speak Out About ‘Evil, Toxic, Emotionally Damaging Company’
Alliantgroup Is Considering Retention Bonuses to Keep People From Fleeing

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Apparently, Mayer Hoffman McCann Passes on GAAS All the Time

Editor’s note: This post was republished, in part, with permission from Jr. Deputy Accountant.

I’m no auditor so perhaps it’s out of line for me to say as much but since when is $8.89 million considered not significant? MHM blew it when it comes to the California city of Bell and the office of the state controller doesn’t like the “rubber-stamp” approach – maybe the state controller needs a lesson in “same as last year” and a quick and dirty primer on how audits really work. As in, they are a total farce and rubber stamps are the best we can do when we’re not checking boxes and counting chairs in warehouses on New Year’s Eve.


LA Times:

A prominent accounting firm’s audits of Bell’s city finances amounted to a “rubber-stamp,” according to a state controller’s study concluding that much of the alleged wrongdoing would have been detected earlier had the firm done its job.

The long-awaited report is being closely watched because Mayer Hoffman McCann audits the books of dozens of government agencies in California and has 30 offices nationwide. Officials at several agencies, including California’s public employee retirement board, have said they were awaiting the controller’s study to help determine whether they would consider changes in their auditing contracts.

The controller’s office found that MHM failed to comply with 13 of 17 “fieldwork auditing standards” when reviewing Bell’s books in the 2008-09 fiscal year. The firm focused mostly on comparing financial numbers year to year rather than looking at potential for inappropriate or illegal activities, the controller’s report said.

Don’t trip, the California Board of Accountancy is on it. Surely.

Chiang said his office is forwarding the report to the state Board of Accountancy, which regulates accounting firms in California. A board official has said it would open an investigation. If significant problems are found, penalties could range from fines to the loss of licenses. The controller also sent copies of the study to the Los Angeles County district attorney’s office and state attorney general, which have been investigating the city.

MHM strongly disputed the controller’s findings, suggesting that Bell officials deceived the firm. “Recent evidence disclosed by the controller’s office shows that Mayer Hoffman was subjected to a massive scheme of collusion that reached through every layer of city government, to undermine the audit process and deceive the auditors,” the firm said in its response.

Bill Hancock, president of the firm, said in a statement that his firm “adheres to the highest standards…. But in those 50 years we have never seen anything like the pervasive collusion of so many individuals acting in concert to deceive auditors, as happened at Bell.”

Jump over to JDA for the rest.

Accountants Behaving Badly: Rogue Tax Preparers, Suzuki Theft, Kiddie Porn

Plus, Filipino accountant gets jail time for embezzlement, and a CFO will spend time in […]

China Calls For a New International Reserve Currency That Isn’t the Dollar (Again)

Dean Baker of the Center for Economic and Policy Research writes via Business Insider:

The NYT told readers that:

“Beijing has few options other than to continue to purchase United States Treasury bonds, Chinese officials are clearly concerned that China’s substantial holdings of American debt, worth at least $1.1 trillion, is being devalued.”

Both parts of this statement are wrong. Beijing has the option to stop buying dollars from its exporters. The reason that the government accumulates dollars and other foreign currencies is that it buys the currency from the companies who are exporting to the United States and other countries.

If Chinese officials were that concerned about it, they wouldn’t keep selling us their useless crap, thereby continuing the vicious cycle of being forced to “cash out” in Treasurys on the difference. If we as Americans were that concerned about it, we’d stop buying the useless crap. Like the “Presidents of the United States” mugs I bought this weekend, which happened to have “Made in China” stickers slapped on the bottom.

On Saturday, after S&P downgraded the U.S. credit rating to AA+ (pretty sure you guys heard about that), Chinese officials said Washington needed to “cure its addiction to debts” and “live within its means,” harsh words considering our living beyond our means has been the main driver of China’s explosive growth in the last decade. ““The U.S. government has to come to terms with the painful fact that the good old days when it could just borrow its way out of messes of its own making are finally gone,” read the statement, released by state-run Xinhua news.

“China, the largest creditor of the world’s sole superpower, has every right now to demand the United States address its structural debt problems and ensure the safety of China’s dollar assets,” it said.

Wrong. The Federal Reserve is the largest creditor of the world’s former superpower (that’s us), and according to them, we can’t inflate fast enough.

“International supervision over the issue of U.S. dollars should be introduced and a new, stable and secured global reserve currency may also be an option to avert a catastrophe caused by any single country,” Xinhua said.

Notice a pattern here yet? GAAP isn’t good enough, we need the IASB to tell us how to recognize leases. Now the dollar isn’t good enough. Not that it ever was, at least not in my lifetime or yours.

Better learn Chinese, people.

3 thoughts on “We Could Soon Know the Results (If Any) of the Feds’ Raid of Alliantgroup”

  1. If you go to LinkedIn, you’ll notice an incredible influx of international student new hires. AG often uses visa sponsorship to recruit fresh grads, but their recruiting practices have never caused a more obvious influx than after their IRS raid.

    Exploitive much?

  2. Where there is smoke there is fire. I used to work there and AG is so shady, smoke and mirrors. Tried to silence me with a meager severance and I said Hell No.

  3. I used to work for AG and they are SO shady! So much illegal activity… I’m sure a government lawyer would love to speak with me. I was very close to management in the Irvine, CA office and have lots of dirt!!!

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