It is hard enough for the federal government to go after people and businesses that hide their money trails through overseas bank accounts and large assets that can be later turned into liquid cash. The federal government must also keep up with other types of fraudulent activity, such as business record tampering. Tampering with business records is the falsifying or preventing a true business entry.
All businesses must give a record of expenditures and assets. Each year, trillions of transactions which involve expenditures and assets are made, leaving a lot of number crunching for the federal government. CEO’s or businesses which try to falsify entries or prevent true entries from being made usually attempt to commit tax fraud.
These individuals may try to show proof that his or her profits have decreased significantly in one year by altering a balance sheet or other type of budgetary plan after the fact. A significant enough drop in earnings may warrant an audit and seizure of documents by the IRS.
The federal government requires true and substantial information from taxpayers in order to decide who to increase or decrease the tax for. Since income tax reports need to be entirely accurate, the federal government is very specific on its definition of “alteration of business records.” Alteration in terms of business is the alteration, deletion, removal, omission, obliteration, or destruction of a true entry. Basically, if any numbers or entries are tampered with after a true transaction has already been made, the CEO or bookkeeper may be liable for an audit.
Omission and Causing Omission
It is one thing for the owner or bookkeeper to omit an entry in his or her business report, but it is another when he or she intentionally conceals the crime. If a document is destroyed, there is a large chance that it no longer exists in physical or digital form. In cases such as this, witnesses or employees may be able to provide information to federal authorities. Also, if bank account figures or other transactions do not correlate with business reports, federal authorities may be able to determine the fraudulent amount.
Many clerks or bookkeepers may fear losing their job and may decide to follow their employer’s orders of falsifying information. Of course, these individuals may also be profiting themselves without the owner’s consent. Documented evidence will prove whether employer or employee is at fault.