- 3 - Background Petitioner is a Maryland corporation, organized on November 8, 1991. At the time of the petition, petitioner’s mailing address was in Rockville, Maryland. During the period relevant to this case, petitioner was owned equally by Norman E. and Aline J. Duquette (together, the Duquettes; individually, Norman and Aline, respectively). From 1968 until 1986, Norman was employed as an auditor by the Defense Contract Audit Agency (DCAA). In 1986, he left the employ of DCAA, and he opened a consulting business (the consulting business), offering advice to Government contractors in connection with their dealings with DCAA. Initially, Norman carried on the consulting business as a sole proprietorship. Norman’s activities as a proprietor were subject to examination by respondent in May 1991. That examination led to a criminal investigation of Norman for tax crimes committed in connection with the sole proprietorship (the criminal investigation). The criminal investigation was resolved by Norman’s pleading guilty to two counts of filing a false income tax return, for 1989 and 1990, in violation of section 7206(1). As a result of his guilty pleas, Norman paid a fine, but he did not serve a prison sentence. In November 1991, Norman organized petitioner to carry on the consulting business. Norman testified that petitioner wasPage: Previous 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 Next
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