UNDERCOVER OPERATIONS: IRS' Management of Project Layoff.
Abstract
IRS initiated Project Layoff because it was concerned about tax evasion, particularly evasion of the wagering excise tax under Section 4401 of the Internal Revenue Code. The project was first proposed in 1981 by Reno District Office CID agents because of their concern that they had not had a major impact on the wagering excise tax compliance problem. They believed that an undercover operation could help IRS identify illegal bookmakers who failed to pay requlred wagering excise taxes. The agents who proposed the project indicated that although wagering excise tax evasion was a significant nationwide problem, Las Vegas played a major role in the national scope of bookmaking activities. They cited IRS estimates that unreported wagering excise taxes in Las Vegas were approximately $4 million per year. The agents further pointed out that the interstate character of the bookmaking operations in Las Vegas could help IRS identify and develop evidence against major bookmakers throughout the United States, many of whom were alleged to have ties to organized crime. In their initial request, Reno District Office CID staff proposed an undercover operation, to be known as Project Layoff, in which two informants were to assist an IRS undercover agent in establishing and running an illegal bookmaking business in Las Vegas. The Western Regional Commissioner approved the proposal and IRS' National Office Criminal Investigation staff also viewed it favorably. However, the Assistant Commissioner (Compliance) disapproved the proposal in July 1981 because of concerns about the motives of one of the informants and whether this informant had sufficient expertise
Document Details
- Document Type
- Technical Report
- Publication Date
- Apr 01, 1992
- Accession Number
- ADA290715
Entities
Organizations
- United States Government Accountability Office