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Parish income tax preparer settles for nearly $1 million
By Staff report
Al Parish’s income tax preparer agreed to pay $952,000 to settle any claims that the company aided in the convicted economist’s fraudulent investment scheme.
Legare & Bailey LLC knew nothing of Parish’s Ponzi scheme, according to an investigation by the court-appointed receiver in the case, Hays Financial Consulting, which is trying to recover money for Parish’s investors.
However, the tax preparer should have recognized several red flags in Parish’s income tax returns that could have alerted Legare to fraudulent activity, Greg Hays said in a settlement motion filed July 16 in court. Parish reported his annual income as $76,000, for example.
“Legare was or should have been familiar with Parish’s extravagant lifestyle and knew or should have known that this stated annual income was far below the amount that would be necessary to support Parish’s lifestyle,” Hays said.
A judge must approve the agreement
Legare provided services to Parish from 1997 to 2004. Daniel Legare had no comment on the settlement.
In the motion, Legare denied the receiver’s allegations and any wrongdoing or liability in the case but sought to settle to avoid the “time, expense and distraction of litigation, as well as the related risk of substantial damage awards.”
Hays noted that the facts do not suggest Legare knew of Parish’s fraudulent activities.
The settlement includes a payment equal to 92.5% of the $1 million policy limit on Legare’s professional liability insurance.
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