Jerry and Patricia A. Dixon, et al - Page 83




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               Mr. Sanchez' Notices of Proposed Disciplinary Action to                
          Messrs. Sims and McWade listed the following reasons for the                
          proposed disciplinary actions:  (1) Negotiating an unauthorized             
          settlement agreement with the Thompsons; (2) basing the Thompson            
          settlement on unaudited and insufficiently documented losses from           
          an unrelated shelter; (3) allowing the Thompsons a settlement               
          that provided them more favorable treatment than other taxpayers;           
          (4) compensating the Thompsons for their attorney's fees; and (5)           
          not informing the Tax Court of the Thompson settlement                      
          arrangements.                                                               
               Mr. Sims responded in writing to Mr. Sanchez on                        
          September 14, 1993.  Nonetheless, Mr. Sanchez sustained the                 
          Notice of Proposed Disciplinary Action issued to Mr. Sims.                  
               Mr. McWade retired from the Internal Revenue Service                   
          effective October 2, 1993, rather than accept a transfer to the             
          Los Angeles District Counsel Office.  On November 2, 1993,                  
          Mr. Jordan approved Mr. Sanchez' proposed disciplinary action.              
          Mr. Sims was suspended from duty without pay for 14 days and was            
          transferred to the San Francisco Regional Counsel Office, where             
          he was assigned nonsupervisory duties as a Special Litigation               
          Assistant in the General Litigation area.                                   
          D.   Indictment of Mr. Izen                                                 
               On May 3, 1995, following an investigation by the Criminal             
          Investigation Division of the Internal Revenue Service, a Federal           
          grand jury indicted Mr. Izen on four counts of conspiracy and               
          money laundering under 18 U.S.C. sections 371 and 1956(a)(3)(A)             

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