U.S. TAX FRAUD CHARGES BROUGHT AGAINST THREE
Three men were charged today with
operating a large tax fraud scheme that provided more than 500
mln dlrs in phony tax losses for many prominent people,
including CBS Inc. <CBS> president Laurence Tisch and his
brother Preston, who is President Reagan's postmaster general.
    The indictment was handed down by a federal grand jury to
in New York.
    The three indicted were named as Charles Atkins, William
Hack and Ernest Grunebaum, all well-known promoters of tax
shelters. Atkins was well-known as an organizer of tax shelters
in the late 1970s and early 1980.
    The indictment said that between 1978 and 1983, the
defendants conspired to defraud the government by arranging
"rigged and fraudulent" transactions in governmenmt securities
and false tax deductions based on phony trading losses and
interest expenses.
    More than 350 mln dlrs in false deductions were passed on
to partners in three tax shelters.
    In addition, the defendants sold over 200 mln dlrs in phony
trading losses and interest expenses to other entities and
individuals to be used as tax deductions.
    The indictment said that over 1.1 billion dlrs in trading
losses and interest expenses were generated by the scheme but
were off-set by "fictious gains."
    Laurence Tisch was said by the indictment to have reported
a net loss of 1.1 mln dlrs. His brother, Preston Tisch,
reported a loss of 480,000 dlrs.
    None of the three men's clients were charged with any
criminal acts. But should the three be found guilty, their
clients will be required to pay taxes they originally avoided
through the tax shelter scheme, plus interest and possibly
penalties. 
 Reuter
