-18-
United States v. Powell, 835 F.2d 1095, 1098 (5th Cir. 1988).
While they argue that Cox had the requisite firm indication of
fraud by virtue of the fact that he entered in the history sheet
that “I believe TP has submitted a fraudulent financial statement
with regards to vehicles, Income and possibly Real Property”, we
do not believe that this entry establishes that Cox had a firm
indication of fraud as to petitioner within the meaning of IRM
section 4565.21(1). We read that entry in the context of the
record as a whole as expressing Cox’s then serious suspicion that
petitioner had engaged in an act that could be fraudulent but
which had to be explored further to determine whether it was in
fact fraudulent. Such a general suspicion of fraud is not a firm
indication of fraud for purposes of IRM section 4565.21(1). See
United States v. Peters, supra at 455-456 (firm indication of
fraud in the context of IRM section 4565.21(1) is different from
an initial indication of fraud and is more than a mere suspicion
of fraud); cf. United States v. McKee, supra at 543; United
States v. Caldwell, 820 F.2d 1395, 1402-1403 (5th Cir. 1987).
Our reading of that entry is supported by Cox’s credible
testimony that he did not at the time of the entry believe he had
the requisite firm indication of fraud to refer the matter to
CID. Our reading is also supported by our finding that Cox did
not know when he made the entry whether petitioner’s omission of
the house and vehicles from his financial statements was proper.
Page: Previous 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 NextLast modified: May 25, 2011